Hongkong Company Formation

L / C Account

The meaning of the Letter of Credit

A Letter of Credit is a conditioned agreement of payment issued by the bank. The bank will issue the letter at the request of the importer (applicant) to the exporter (beneficiary) as an evident to guarantee a payment. The beneficiary must provide the service on the stock according to the L/C together with an invoice to the importer in order to receive payment from the bank. And because the L/C is owned by the bank, thus the bank will then become the first payer of the L/C.

The use of L/C is suitable to the situations below:  

  Trading

  To reduce the risks in international trading

  To increase the enforcement on the date of shipment and  the receipt of the imported stock  

The advantages of L/C  

The L/C can greatly reduce the risk in receiving payment on the exporter where it can also reduce the risk of payment on the importer when the stock is not agreed with the Letter of Credit.

It is necessary to create a bank account before requesting a Letter of Credit from the bank to purchase stocks with an L/C bank account. Youfu Accountants Limited provides a convenient and complete service for the client from opening a bank account to an L/C account.

The procedure to open a bank account becomes simple and easy as the client is no longer required to present in the event of creating an account. Youfu Accountants Limited is among the few which are listed as professional intermediaries of HSBC and Standard Chartered Bank. We offer our clients the convenience of completing and signing procedured to be done at one of our local offices for a brand new bank account to be created within 30 working days.

  Requirements on the creation of bank account and its procedures  

Related documents
1
A signed and chopped declaration form of the company’s business nature is also required from the client
2
Proof of address of the account holder (depends on different bank requirement)

3

Proof ofidentity of the account holder
4
Director who does not want to be appointed as the controller of the bank account must sign on the section “Not include signature” of the bank account application form for confirmation
5
The bank has reserved the rights to reject any account application.

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