Part 1: Risk assessment in international trade
Payment methods
Letters of credit (L/Cs)
Advantages and risks
exporter’s viewpoint:
from
the
Advantages
•
Risks
The importer's credit risk is eliminated
(the issuing bank takes the risk).
• The country risk is eliminated (when the
L/C is confirmed).
• The foreign exchange risk is eliminated
(when the L/C is issued in the currency
of the exporter).
• More expensive.
• Terms and conditions may not be
respected.
The risks are low / medium for the
exporter
Export platforms | Module 5: Getting paid
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