12 July 2010
What is the procedure of LC ? We paid a party through LC, Bank Charge Bank charges. And interest on the same. What happened if party get it discounted and if not.
12 July 2010
The LC is opened by your banker in favour of a third party, if the third party who may be a your vendor, demands the same.Against LC 25 % margin deposit is retained by the banker.Normally LC has a tenure of 6 months.Once it matures,margin deposit and interest accrued thereon are released and creited to your bank account.Tenor of LC is usually delivery at site or usance whichever is earlier,for a period upto 90 days.LC amount will be debited to your bank account on maturity.
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