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SBLC International Payment Guarantee

FOR SMOOTH AND SECURE INTERNATIONAL COMMERCIAL TRANSACTIONS

ETC’s International Payment Guarantee Standby Letter of Credit (SBLC) is a financial solution designed to secure international trade transactions for African banks and their corporate clients. 

This service provides an irrevocable payment guarantee, ensuring reliable and secure transactions.

Our observation

In the context of international trade in and with Africa, payment security and trust between trade partners are crucial. 

The SBLC Payment Guarantee helps overcome challenges related to economic instability and political uncertainties, facilitating international exchanges and reducing financial risks for both exporters and importers.

What is it ?

The SBLC Payment Guarantee is an irrevocable banking commitment issued by the importer’s bank, ensuring that the seller (exporter) will receive payment, provided the documents presented comply with the specified terms and conditions. It secures commercial transactions by confirming that payment will be made once the contractual conditions are met.

Who can benefit ?

  • African banks: to secure their clients’ transactions and strengthen their credibility with international partners.
  • Corporate clients: exporting companies of goods and services wishing to guarantee payment from their foreign buyers.

When to request it ?

  • To secure international trade transactions.
  • When there is a lack of trust between trade partners.
  • In the presence of high political or economic risks.
  • To facilitate access to international markets for the exporting company.
  • To benefit from flexible and secure payment terms.

The advantages

  • Payment security: Guarantees payment to exporters provided the terms of the guarantee are met.
  • Risk reduction: Minimizes the risks of non-payment and commercial disputes.
  • Transaction facilitation: Simplifies and accelerates international trade exchanges.
  • Trust reinforcement: Establishes a trust-based relationship between importer and exporter.
  • Access to favorable credit terms: Allows negotiation of advantageous payment terms and improves cash management.
  • Regulatory compliance: Ensures that transactions comply with international and local regulations.

 

The terms of the SBLC International Payment Guarantee


Silent risk sub-participation


Yes


Transaction to be guaranteed


Up to 5 Millions €

 


Maximum rate Guaranteed


Up to 80% of the transaction


Tenor


on a case by case basis depending on transaction


Risks covered


Non-payment risk

 


Generating facts


Maturity default declared by the lender


Commitment


Periodic Reporting

SBLC International Payment Guarantee in a nutshell


Object


Payment guarantee for international trade transactions.


Risk


Risk of non-payment by the importer after receiving the goods as agreed.


Instrument


Standby Letter of Credit (SBLC)


SWIFT Interbank Message


FIN MT760


Obligor


Importer’s bank / Importer


Guarantee / Confirming


ETC – Export Trading & Cooperation


Beneficiary


Exporter / Foreign supplier

Formula :APR = (AF/T) + (IF/T) + CF

Caption:

APR = Annual Percentage Rate

AF = Application Fees (Indicative rate 1% flat)

IF = Issuing Fees (Indicative rate 0.5% flat)

T = Tenor (year)

CF = Commitment Fee (Annual rate according to Financial Rating*)

*  See table

Submit your need

Download the brochure

SBLC International Payment Guarantee