Irrevocable Documentary Letter of Credit (IDLC) Services

Irrevocable Documentary Letter of Credit (IDLC) Services

Irrevocable Documentary Letter of Credit (IDLC) Services

We help importers, traders, and project buyers secure Irrevocable Documentary Letters of Credit under UCP 600. The scope covers underwriting, LC text drafting, bank selection, advising and confirmation where required, document control, and closing. The goal is simple. Issue a clean LC that ships, pays, and stands up to document checks.

Snapshot: MT700 issuance with MT707 amendments as needed. Sight or usance up to 180 days. Transferable and back-to-back where eligible. First draft LC text in 5 to 10 business days after full documents and cleared payment. Issuance timing depends on bank, jurisdiction, and confirmation needs.

Where We Add Value

Clean LC Text and Terms
Drafting under UCP 600 with clear field instructions, document lists, presentation periods, and charge clauses that reduce discrepancy risk.
Confirmation Procurement
Arrange advising and confirmation where the seller asks for bank risk in their country. Pricing and availability depend on bank and country risk.
Applicant Underwriting
Review financials, trade history, and shipment plan. Plan for cash cover or collateral where the issuing bank needs it to approve the LC.
Document and Logistics Control
Align Incoterms, shipment deadlines, and transport documents with the LC so the seller can present conforming documents and get paid on time.

When an IDLC Makes Sense

  • New supplier relationship where open account is not acceptable.
  • Commodity shipments that require tight document control and fixed deadlines.
  • Equipment or turnkey deliveries with staged shipments and complex packing lists.
  • Seller’s jurisdiction requires confirmation to accept buyer risk.
  • Regulatory or contract requirement for bank payment undertaking.

LC Structures We Arrange

Type Details
Sight LC Payment at sight against compliant documents. Standard for first time trades.
Usance LC Deferred payment, commonly 30 to 180 days. Discounting may be available at the nominated bank.
Transferable LC Allowed where the beneficiary is an intermediary. Must be marked transferable in the LC.
Back-to-Back LC Second LC issued on the strength of a master LC. For structured trades with intermediaries.
Confirmed LC Advising bank adds its payment undertaking. Pricing depends on country and bank risk.

Key Terms to Finalize

Term Guidance
Amount and Tolerance Face value and ± tolerance, currency, and latest shipment plan linked to Incoterms.
Expiry and Place of Expiry City and bank where documents are presented. Presentation period after shipment in days.
Documents Required Invoice, packing list, transport document, certificate of origin, inspection, and insurance where required.
Charges Clause Who pays which charges. Common clause: outside applicant’s country for beneficiary’s account, subject to negotiation.
Confirmation Requested or may add. Confirmation availability depends on the issuing bank and country risk.

Process and Timeline

  1. Intake. Share applicant details, trade summary, draft contract or proforma invoice, shipment plan, and model cash flows.
  2. KYC and Screening. Applicant and counterpart screening. Invoice is issued after preliminary clearance.
  3. Underwriting. Credit memo, collateral or cash cover plan, and LC term sheet. First pass in 5 to 10 business days after full documents and cleared payment.
  4. Bank Selection. Match issuing and advising banks by currency, corridor, and confirmation needs.
  5. LC Text Drafting. Prepare draft MT700 fields with document list and charge clause. Negotiate with the seller before issuance.
  6. Issuance. Issuing bank sends MT700. MT707 amendments only if required by both parties. Advising and confirmation as agreed.
  7. Shipment and Presentation. Seller ships under agreed Incoterms and presents documents within the presentation period.
  8. Payment. Sight payment or deferred payment at maturity, subject to compliant presentation.

Documentation Checklist

Item Details
Company Files Corporate docs, shareholding, board approvals, and authorized signatories.
Financial Statements Audited or reviewed accounts and recent management accounts.
Trade Contract Signed contract or proforma invoice with Incoterms and shipment plan.
KYC and Sanctions Applicant KYC, counterpart details, and end buyer where relevant.
Collateral and Cash Cover Evidence of cash cover, guarantees, or other security if the bank requires it.

Mandate and Fees

Underwriting Fee From $25,000 to $95,000 based on face value, currency, and confirmation needs. Invoice issued after KYC clearance.
Success Fee 0.5% to 1.25% of LC face amount on issuance. Minimums apply.
Bank Charges Issuing, advising, confirmation, SWIFT, and reimbursement charges are for the client. Quoted by banks during the process.
Refunds Fees are non refundable once underwriting begins.

Request Your LC Term Sheet

Submit your intake form. After KYC, your invoice will be issued. Underwriting starts when payment clears.

Submit Intake Form

FAQ

What Is an Irrevocable Documentary Letter of Credit?
An IDLC is a bank undertaking to pay the seller when the seller presents documents that comply with the LC terms. It is issued under UCP 600 and cannot be changed without consent of all parties.
How Is an IDLC Different From an SBLC?
An IDLC is for documentary trade. Payment follows presentation of documents. An SBLC is a secondary undertaking that pays on demand if the applicant fails to perform. Different use cases and SWIFT messages apply.
Can You Arrange Confirmation?
Yes, where a confirming bank has appetite for the issuing bank and country. Pricing depends on tenor, currency, and risk limits at the time of request.
What Cash Cover Do Banks Require?
Requirements vary. Strong applicants may receive limits without full cash cover. Others may need partial or full cash margin, or collateral. This is set during underwriting by the issuing bank.
How Long Does Issuance Take?
Draft LC text is typically prepared in 5 to 10 business days after full documents and cleared payment. Final issuance depends on bank processing, any amendments, and confirmation if requested.
Do You Arrange Transferable or Back-to-Back LCs?
Yes, for eligible trades. Transferable requires the LC to state it is transferable. Back-to-back needs a master LC of suitable quality and timing to support the second LC.
Which Banks Issue the LC?
We work with reputable banks subject to the applicant’s credit, collateral, sanctions screening, and each bank’s current appetite. Issuer selection is part of underwriting. We do not present banks as partners or make guarantees.

We are an arranger and advisor. We are not a lender and do not guarantee issuance. All mandates are best efforts and subject to underwriting and compliance. Pay only to bank details on our official invoice. Beware of unsolicited contact through unofficial channels.

Get Started With Us

Submit Your Deal & Receive a Proposal Within 1-3 Working Days

Submit your deal using our secure intake form, and receive a quote within 1-3 business days. Existing clients can connect with their relationship manager through our secure web portal.


All submissions are promptly reviewed, and all communications are conducted through the intake form or the client portal for a seamless and secure process.

Express Application Submit Your Deal
Request a Proposal
Request a Proposal / Submit a Deal

Thank you for considering working with us. A nominal fee of US$500 is required upon completion of each form. This fee covers the time and effort we invest in reviewing your submission and crafting a thorough proposal. We receive numerous inquiries and prioritize those that carry this fee, ensuring serious applicants receive prompt attention.

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Secure financing for business or real estate acquisitions. We ease transaction hurdles by reviewing cash flow, synergy opportunities, and exit plans. Complete the form for a customized proposal that supports your strategic investment objectives.

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For Banks

Financely assists banks facing Basel III pressures by distributing trade finance deals and providing collateral for letters of credit. We reduce capital burdens while preserving client relationships and fostering service expansion. Submit your request to optimize your trade finance offerings.

Submit a Request

Once we receive your submission, our team will review your information to determine feasibility. If eligible, you will receive a proposal or term sheet within 1–3 business days. Visit our FAQ and Procedure pages for more information.

Disclaimer: Financely provides financing based on due diligence and feasibility. Approval is not guaranteed, and past performance does not predict future outcomes. All terms are subject to review. Financely primarily assists with structuring and distribution. Qualified parties carry out the project if the client approves the proposal.

Still Have Questions? Schedule a Consultation

If you still have questions after visiting our FAQ and Procedure pages, we invite you to book a paid consultation for personalized guidance. A $250 USD fee applies per session.