DOCUMENTARY CREDIT
The Documentary Credit is an international payment technique for the financial settlement of import or export activities. The Documentary Credit allow importers and exporters to deal confidently with one another since the payment will be made if all terms and conditions of the Documentary Credit are complied with.
We propose several types of documentary credit
– The Irrevocable Documentary Credit: The undertaking of the issuing bank cannot be cancelled or modified without the prior consent of all credit parties, notably the recipient/payee. An irrevocable documentary credit means that the commitment is a firm and irrevocable undertaking on the part of the issuing bank.
– The Confirmed Irrevocable Documentary Credit: The exporting party or vendor can request that the documentary credit issued in his favour is confirmed. This means that the notifying bank becomes the confirming bank. A confirmed irrevocable documentary credit is a double undertaking from both issuing and confirming banks.
Major Benefits
A Confirmed Irrevocable Documentary Credit is a form of insurance against the following risks
• commercial
• banking
• political
• failure to transfer
The Import Documentary Credit or Import Letter of Credit
The Import Documentary Credit or Import Letter of Credit is a payment technique whereby the Bank undertakes to settle your credit with your supplier, subject to the documents remitted to your supplier being conform with the importation documentary credit.
Main benefits
• Facilitates your importation activity;
• Provides your supplier with the assurance of being paid;
• Guarantees the delivery of your imported goods, as payment is effected between your bank and the supplier’s bank;
The Export Documentary Credit or Letter of Credit
When engaged in export activities, an export documentary credit or letter of credit guarantees the settlement by your client’s bank, provided that the goods are delivered and the required accompanying documents presented as per the agreement thereof in the export letter of credit.
Main benefits
• Control over the risk of non-payment of your exports.
• Better control over your trade operations.
The Stand-By Letter of Credit
The stand-by letter of credit is a firm and irrevocable undertaking on the part of the Bank to settle the supplier (the Beneficiary). It acts as a guarantee for the Beneficiary (the exporter supplying you with the goods).
Eligibility
A company operating in the international trade sector.
BANK GUARANTEES
In need of a financial guarantee for a specific operation or a third party? – We can help out.
At the client’s request, BPCE IOM Ho Chi Minh City Branch will issue a written commitment to a designated third party (the beneficiary) in which we will perform your financial obligations in case you do not perform/or perform them improperly.
Benefit
• Satisfy your partner’s requirement for a bank guarantee.
• Increase your reliability with partners by having a a solid and reliable guarantee.
Types of guarantees proposed
Payment guarantee This ensures the beneficiary the performance of your payment obligation. In case you don’t (fully) perform it, we will pay on your behalf on due date upon presentation of complying documents stipulated in the guarantee .
Performance guarantee This is a contractual guarantee. Its purpose is to compensate the beneficiary in the event of the improper execution of the contract by the applicant (delays, quality etc.).
Tender Bond A written commitment issued by the Bank to ensure the bid inviter (the beneficiary) the performance of your bid participation obligation. In case your have to pay a fine due to violation of bidding regulations ( i.e. not sign the contract or submit performance guarantee within the preset time once winning the bid …) but don’t (fully) pay, we will pay on your behalf upon presentation of complying demand.
Advance Payment Bond Commercial contracts usually specify that the buyer must first settle one or several down payments before the vendor starts the manufacturing process or the delivery of supplies. As a counterpart, the buyer requests an advance payment security from the vendor. This ensures the buyer that in the event the vendor does not satisfy the terms of the contract and its respective obligations, the down payment will be refunded.
Shipping Guarantee An indemnity provided by the Bank to a shipping company or its agent to allow the shipping company or its agent to release goods to the customer (the importer) without presentation of original Bill of Lading. Shipping Guarantee is commonly used under L/C with Bill of Lading consigned to the order of BPCE IOM Hochiminh City branch.
Other Guarantees at client’s request not prohibited by laws.
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DOCUMENTARY COLLECTION
Your company is engaged in international trade, whether importing or exporting?
Do you wish to ensure payment from your international clients or to settle your suppliers?
BPCE offers you the documentary collection facility: a means of payment offering you increased flexibility for the financial management of your trade transactions.
For importation
As an importer, the Import Documentary collection offers an international payment technique which allows the supplier to be settled with the required payment at sight or on term basis, upon presentation of the documents towards the Bank.
Import Documentary Remittance presents advantageous solutions to importers:
• It secures your payment to the supplier since you make a payment only when you receive evidence of the shipment.
• It ensures the reception of your importations, in strict accordance with contractual terms.
• It is a simple and cost-effective alternative to Letter of Credit when you deal with trusted partners
For exportation
As an exporter, the Export Documentary Remittance offers an international payment technique which ensures the required settlement for the exportation of your goods upon submission of your documents by the Bank to your client’s bank. This document specifies under which conditions and at which moment these documents are to be handed over to the buyer.
The Export Documentary Remittance presents advantageous solutions to exporters:
• The goods you export will be delivered to the client solely against a draft or upon the assurance that payment is effective;
• You benefit from our international network and local expertise. Your documents are directly transmitted to the buyer’s bank.
Eligibility
A company engaged in international trade, either importing or exporting.
IMPORT CREDIT FACILITIES
The Import credit facility is a credit facility which supports funds for customers to settle payment to overseas suppliers;
Term limits
The term is pre-determined and can be short-term from 30 to 360 days to mid-term (from 1 to 5 years) or long-term (abover 5 years)
Benefits
• Assist importer’s cashflows to settle to overseas suppliers.
• Both goods & machineries can be considerred under import loans.
• Allows for multi-currency financing (subject to SBV’s regulation)
• Flexible term
• Negotiable exchange rate
• Relationship Manager will consider to tailor-made the limit upon your project/business plan.
INVOICE/BILL DISCOUNTING
The Discounting Line is a short-term credit facility which supports funds to customers by discounting the export document (LC, export contract, invoice…)
Term limits
The term is pre-determined and can be extended from 30 to 360 days
Benefits
• Immedicate cash advance to support export activities
• Allows for multi-currency financing (subject to SBV’s regulation)
• Flexible term
• Negotiable exchange rate
• Relationship Manager will consider to tailor-made the limit upon your project/business plan.
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