: The supplier ships the goods and presents the required documents to their bank. These are then forwarded to the Transferring Bank.
A (translation: переводной аккредитив ) is a trade finance instrument that allows an intermediary (the first beneficiary) to transfer all or part of the credit to one or more secondary beneficiaries, such as suppliers. This mechanism is widely used in international trade where brokers or agents facilitate transactions without having the funds to pay their suppliers upfront. Workflow of a Transferable Letter of Credit The process typically involves these key steps: shema perevodnogo akkreditiva
: The middleman has the right to substitute the supplier’s invoices with their own to claim the profit margin (the difference between the buyer's price and the supplier's price). : The supplier ships the goods and presents
: The Transferring Bank notifies the supplier’s bank ( Advising Bank ) of the transferred credit in favor of the second beneficiary. This mechanism is widely used in international trade
: The buyer and the middleman (first beneficiary) sign a sales contract. Simultaneously, the middleman signs a purchase contract with the actual supplier (second beneficiary).
: The Transferring Bank advises the middleman of the credit. The middleman then requests the bank to transfer the credit (or a portion of it) to the supplier.