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LETTER OF CREDIT

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Originally appearing in Volume V16, Page 501 of the 1911 Encyclopedia Britannica.

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LETTER (through Fr. lettre from Lat. littera or litera, letter of the alphabet; the origin of the Latin word is obscure; it has probably no connexion with the root of linere, to smear, i.e. with wax, for an inscription with a stilus)

LETTER OF See also:
CREDIT (Lat. credere, to believe)
CREDIT , a letter, open or sealed, from a banker or See also:

MERCHANT (O. Fr. marcheant, modern marchand; from Lat. mercari, to trade, merx, goods, merchandise)

merchant, containing a See also:

REQUEST, LETTERS OF

request to some other See also:

PERSON, OFFENCES AGAINST THE

person or See also:

FIRM

firm to advance the See also:

BEARER

bearer of the letter, or some other person named therein, upon the credit of the writer a particular or an unlimited sum of See also:

MONEY

money. A letter of credit is either See also:

general or See also:

SPECIAL

special. It is general when addressed to merchants or other persons ingeneral, requesting an advance to a third person, and special when addressed to a particular person by name requesting him to make such an advance. A letter of credit is not a negotiable See also:

INSTRUMENT (Lat. instrumentum, from insincere, to build up, furnish, arrange, prepare)

instrument. When a letter of credit is given for the See also:

PURCHASE

purchase of goods, the letter of credit usually states the particulars of the merchandise against which bills are to be See also:

DRAWN

drawn, and See also:

SHIPPING

shipping documents (bills of See also:

LADING (from " to lade," O. Eng. hladan, to put cargo on board; cf. " load "), BILL OF

lading, invoices, See also:

INSURANCE

insurance policies) are usually attached to the draft for See also:

ACCEPTANCE (Lat. acceptare, frequentative form of accipere, to receive)

acceptance.

End of Article: LETTER OF CREDIT

Additional information and Comments

Payment realised against the Letter of Credit can be transfered to the account of the Manufacturer exporer on the instructions of the beneficiary of the Letter Of Credit

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