SUB LC Meaning and
Definition
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"SUB LC" is an abbreviation for "Subsidiary Letter of Credit," which refers to a financial instrument that is commonly used in international trade transactions. A subsidiary letter of credit is issued by a bank on behalf of the buyer (importer) to the supplier (exporter) in order to facilitate the purchase of goods or services.
This type of letter of credit serves as a form of payment assurance for the supplier, ensuring that they will receive payment for the goods or services provided. It acts as a secondary guarantee to the original letter of credit (often referred to as the master or primary letter of credit).
The sub LC is usually issued when the buyer and supplier are not directly involved in the transaction, or when the supplier requires additional payment assurance. It is initiated by the buyer's bank, which will issue the sub LC to the supplier's bank, stating the terms and conditions of the transaction.
The key difference between a sub LC and a regular LC is that a sub LC relies on the terms and conditions set out in the master LC. It is essentially a separate document that references the master LC and provides additional details specific to the supplier.
In conclusion, a sub LC is a subsidiary letter of credit that is issued by a bank on behalf of the buyer to the supplier, serving as a secondary payment guarantee in international trade transactions.
Common Misspellings for SUB LC
- zub lc
- xub lc
- dub lc
- eub lc
- wub lc
- syb lc
- shb lc
- sjb lc
- sib lc
- s8b lc
- s7b lc
- suv lc
- sun lc
- suh lc
- sug lc
- sub kc
- sub pc
- sub oc
- sub lx
- sub lv
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