Letter of Credit Issuance

Guarantee payment to your suppliers

Letter of Credit Issuance

Guarantee payment to your suppliers

At a Glance
A Letter of Credit (LC) is issued at your request to assure payment to your supplier up to a stated amount, within a prescribed time.

Stronger ties

Build stronger relationships and support new business opportunities


On your terms

Ensure the necessary documents are received for goods clearance



Documents are checked for compliance and terms before you make payment

Features & Benefits

Help when you need it

Our experts can offer you advice and expertise


Leverage our “AA-” and “Aa1” credit ratings

Provide your sellers with assurances of payment through our Letters of Credit


Save time and ensure fast delivery

Apply for a Letter of Credit online via DBS IDEAL

Types of Letter of Credit
Sight Letter of Credit

Issuing bank will honour payment at “sight”, meaning payment is made once documentation received is in order.

Usance Letter of Credit

Issuing bank will accept the draft once all documentation received is in order and agree to pay on the due date.

Red Clause Letter of Credit

Allows the issuing bank to make a partial advance payment to the seller upon receipt of documentation.

Transferable Letter of Credit

DBS transfers the Export LC in favour of the ultimate seller at the request of the middleman who will then sell goods under the Export LC.

Back-to-Back Letter of Credit

The master Export LC from the buyer’s bank backs the issuance of an Import LC. Proceeds from the Export LC are used to pay the bank under the Import LC.

How it Works

  1. The buyer and seller enter into a contract and agree that payment be made on the basis of Letter of Credit
  2. Buyer approaches DBS (issuing bank) to issue Letter of Credit in favour of the seller
  3. DBS issues Letter of Credit which is advised through its branch or correspondent bank (advising bank) in the seller’s country
  4. Advising bank advises Letter of Credit to the seller
  5. Upon receipt of the Letter of Credit, the seller prepares shipment and delivers documents to presenting bank
  6. Presenting bank despatches documents to DBS for payment
  7. DBS pays the presenting bank upon verifying the documents are in order
    Upon receipt of payment, presenting bank pays the seller
  8. Buyer pays the document amount to DBS
  9. DBS forwards the documents to the buyer, who can now use them to obtain the goods
How to Apply

Call us on 400 821 8881 or visit any of our Branches for more details. You may also email us and arrange our Relationship Manager to call you.

Can you issue a Letter of Credit to my seller, without a DBS facility?

No, you must obtain credit facility before we issue a Letter of Credit to your seller.

Can DBS issue an LC if the seller doesn’t provide the advising bank’s details?

Yes, when there is no DBS branch or office in the seller’s country, we issue the LC and advise through a network branch/agent bank.