Our Letters of Credit service opens doors to new contracts, markets and opportunities for our business customers.
We can assist you in the sale and purchase of goods and services on terms that best serve the interests of buyer and seller. Our Letters of Credit service plays a vital supporting role to many businesses by offering advice and guidance on managing credit, political issues, performance, documentation, financial institution credit as well as various risks involved.
Several participants are involved in a letter of credit transaction:
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The applicant is the party that arranges for the letter of credit to be issued.
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The beneficiary is the party named in the letter of credit in whose favor the letter of credit is issued.
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The issuing or opening bank is the applicant's bank that issues or opens the letter of credit in favor of the beneficiary.
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The advising bank is the bank that may be named in the letter of credit that advises the beneficiary that the letter of credit was issued.
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The paying bank is the bank nominated in the letter of credit that makes payment to the beneficiary without recourse, after determining that documents conform and upon receipt of funds from the issuing bank or another intermediary bank nominated by the issuing bank.
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The confirming bank is the bank which, under instruction from the issuing bank, substitutes its creditworthiness for that of the issuing bank. It ultimately assumes the issuing bank's commitment to pay.
QNB branches provide all of the above mentioned banking services for the benefit of its customers.