Import Services

Documentary Credit Issuance

Provide assurance to your suppliers when complying documents are presented

Build relationships with clients and support new business opportunities with a DBS Documentary Credit. We issue a Documentary Credit at your request, assuring payment up to a stated amount within a prescribed time. We then check that the documents received are in compliance with the Documentary Credit terms and certify them before you make payment.

 

How Does a Documentary Credit Work?

 

  1. The buyer and seller enter into a contract and agree that payment be made on the basis of Documentary Credit
  2. Buyer approaches DBS (issuing bank) to issue Documentary Credit in favour of the seller
  3. DBS issues Documentary Credit  which is advised through its branch or correspondent bank (advising bank) in the seller’s country
  4. Advising bank advises Documentary Credit  to the seller
  5. Upon receipt of the Documentary Credit, the seller prepares shipment and delivers documents to presenting bank
  6. Presenting bank despatches documents to DBS for payment
    1. DBS pays the presenting bank upon verifying the documents are in order
    2. Upon receipt of payment, presenting bank pays the seller
  7. Buyer pays the document amount to DBS
  8. DBS forwards the documents to the buyer, who can now use them to obtain the goods

 

Why choose DBS Documentary Credit Issuance?

  • Grow your business with the Best Trade Finance Bank in Singapore, as named by Alpha Southeast Asia and The Asia Banker in 2012. We also received this accolade from Global Finance in 2012, for the 8th consecutive year
  • Leverage our "AA-" and "Aa1" credit ratings to provide your sellers with assurances of payment through our Documentary Credit
  • Enlist the help of our specialists, who offer advice and expertise
  • Save time and ensure faster delivery by applying for a Documentary Credit online through IDEAL™, our online banking platform
  • Ensure payments are made only when the necessary documentation is received and has been checked by our experienced, certified documentary checker
  • Submit forms any time before 6pm on a working day to ensure your transactions are processed on the same day. We offer one of the latest cut off times in Hong Kong  for your convenience

Product Details

Common types of Documentary Credit:

Sight Documentary Credit

The issuing bank will honour the payment at “sight”, which means the payment will be made once the documentation received is in order

Usance Documentary Credit

The Issuing bank will confirm the maturity date once all documentation received is in order and agree to pay at maturity

Red Clause Documentary Credit

This allows the issuing bank to make partial advance payment to the seller upon receipt of the documentation. This is commonly used in the manufacturing industries

Transferable Documentary Credit

This is usually used by middleman traders who do not enjoy a credit facility. DBS will transfer the Export Documentary Credit in favour of the ultimate seller at the request of the middleman, who will then sell the goods under the Export Documentary Credit

Back-to-Back Documentary Credit

This is used by middleman traders with a credit facility. The master Export Documentary Credit from the buyer’s bank backs the issuance of an Import Documentary Credit. Proceeds from the master Export Documentary Credit are then used to pay the bank under the Import Documentary Credit

Standby Documentary Credit

This is typically used to assure the applicant will meet the payment obligations or contractual performances specified. Another commonly used product in this situation is a Banker’s Guarantee

FAQs

Can you issue a Documentary Credit to my seller if I do not have a DBS credit facility?

No, you must obtain a credit facility with DBS before we can issue a Documentary Credit to your sellers. Please call us at 2290 8068 should you require assistance.

How do I complete the Documentary Credit application form?

You may call us at 2290 8068 for enquiry.

Can DBS issue a Documentary Credit if the seller doesn’t provide the advising bank’s information?

Yes. We issue the Documentary Credit and advise through our network branch or agent bank in the event that we do not have a branch or office in the seller’s country.

 

How do I apply?

Simply submit your documentary credit application form at one of our Trade Collection Branches or Enterprise Banking Centres. Alternatively, you can apply via IDEAL™.

Product Finder
Product Finder

Tell us your business needs and we’ll bundle a solution for you.

Get Solutions
Awards
Awards

Best Trade Finance Bank in Singapore, 2012, Alpha Southeast Asia

View All