A New Delhi based importer and distributor of Engineering plastics with an annual turnover of INR 1000+ crores. The company imports plastic resin from suppliers across the globe every month in multiple shipments. Client regularly avails supplier’s credit facility under Usance LC payable at sight (UPAS LC). Normally, documents are routed from the beneficiary bank to the negotiating bank to the LC issuing bank for acceptance. The beneficiary lodged the documents with another relationship bank (which was not a bank mentioned in the LC). Since this bank wasn’t a party to the LC, they routed the documents directly to our client’s bank as per the details in transaction documents.
Myforexeye Value addition:
The client was unaware of the fact that documents were routed through another bank to their LC issuing bank. The shipment arrived at an Indian port and was ready to be released. Client approached their bank with their acceptance to get the documents released. Then they got to know that documents had arrived through a different bank instead of the negotiating bank or the beneficiary bank. Given the uncertainty regarding the release of documents and the impending demurrages in a day or two, Myforexeye team suggested to the client to arrange a clarification letter from their beneficiary stating the erroneous routing of documents. The beneficiary stated in the letter that they erroneously submitted the documents to their other bank instead of the primary bank. Clarification letter was sent by beneficiary to issuing bank via mail & was later forwarded to negotiating bank for notification of the issue. Myforexeye team coordinated with the negotiating bank as well as the issuing bank to get the documents released in time and the funding to be made to beneficiary bank at sight.
The client was able to release his goods on time & funds were remitted by the negotiating bank at sight. The client was happy with the service provided by Myforexeye team in solving the problem with timely advice and coordination with both the LC issuing bank & negotiating Bank.
20 Apr 2019 04:05 PM
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