thanx armageddo for the reply...agreed but what about risk to confirming bank..
Also i heard that if confirming bank does not pay it is the ISSUING BANK which has to honour the complying presentation....Kindly clarify your statement
the risk for the confirming bank comes into picture when the confirming bank has undertaken to pay the docs and the issuing bank has refused to pay becos of thepossible discrepancies it had found out. then confirming bank is at a risk. that'w why confirmation always comes for a good charge being levied by the confirming bank.
now, if the confirming bank does not pay the bene for reasons whatsover, the issuing bank can honour them as the l/c is available with the issuing bak at the time it issues an l/c . also the undertaking of the issuing bank to pay the bene is independent of its undertaking to pay the confirming bank .hope this suffice,.
thanks prem for the clarification,but suppose the docs are discrepant as u said above and the issuing bank refuses to pay.....and the confirming also refuses to pay......who is ultimately liable for payment to the bene....
Hi! No risks - only
Hi!
No risks - only advantages.
Confirmation gives you double security of getting your money in case compliant docs will be presented.
If issuing bank will not pay (for any reason) then confirming bank should pay.
Of course, confirmation costs money and sometimes significant.
Also, please, read appropriate UCP600 provisions on what is confirming bank and what are its obligations.
Good luck
risk to confirming bank.
thanx armageddo for the reply...agreed but what about risk to confirming bank..
Also i heard that if confirming bank does not pay it is the ISSUING BANK which has to honour the complying presentation....Kindly clarify your statement
hi
hi zapcoolsail,
the risk for the confirming bank comes into picture when the confirming bank has undertaken to pay the docs and the issuing bank has refused to pay becos of thepossible discrepancies it had found out. then confirming bank is at a risk. that'w why confirmation always comes for a good charge being levied by the confirming bank.
now, if the confirming bank does not pay the bene for reasons whatsover, the issuing bank can honour them as the l/c is available with the issuing bak at the time it issues an l/c . also the undertaking of the issuing bank to pay the bene is independent of its undertaking to pay the confirming bank .hope this suffice,.
Who is liable to pay
thanks prem for the clarification,but suppose the docs are discrepant as u said above and the issuing bank refuses to pay.....and the confirming also refuses to pay......who is ultimately liable for payment to the bene....
hi
hi zapcoolsail,
the bene has to face the loss!. when he has presented discrepant docs, ultimatley he has no right to claim the funds.
Thanx a ton
Hi prem...thanx a ton for the clarification..god bless
zap