Documentary operations, Documentary operations

ProCredit Bank offers documentary credit products and guarantees on extremely favourable terms and conditions, not only to clients in the import and export trade, but also to provides of goods and services within Serbia.

The following types of documentary services are available:

Documentary collection is an arrangement concluded by parties to international trade transactions, whereby the exporter submits commercial documents (such as invoice, transport document, etc.) and/or financial documents (e.g. bill of exchange) to the importer through its bank (the remitting bank). The remitting bank sends the respective documents to the collecting bank, which forwards these documents to the importer for collection. Collection is executed either at sight or within the agreed period of time after sight.

Documentary collection is a simple and efficient instrument as documents constitute indisputable proof that the exporter`s contractual obligations have been met (i.e. the goods have been dispatched). At the same time, the exporter can be certain that the goods will be remain in the exporter`s possession until payment has been effected or the bill of exchange has been accepted.

A letter of credit is an irrevocable liability on the part of the bank to effect payment to the specified beneficiary (seller-exporter) provided that the documents presented are in accordance with the conditions stipulated in the letter of credit.
A letter of credit is the safest payment instrument used in international trade transactions, it protects the interests of both the seller (exporter) and the buyer (importer) in equal measure.
It provides assurance to the selling party that it will receive payment after having submitted the necessary documents (in compliance with the terms set forth in the letter of credit).

We offer two types of letters of credit:

1. Letters of credit at sight, which assure immediate payment
2. Letters of credit with deferred payment, which allow a certain term for settlement

A guarantee is a security instrument whereby the bank assumes independent and irrevocable liability to pay the amount of the guarantee to the beneficiary of the guarantee if the debtor named in the underlying contract fails to meet the contractual obligations or fails to duly fulfil any of the obligations stipulated in the contract.

ProCredit Bank’s offer includes all types of guarantees valid in Serbia and abroad through its network of correspondent banks.

These guarantees include:

• Payment guarantees
• Advance payment guarantees
• Warranty guarantees
• Performance guarantees
• Customs guarantees
• Loan guarantees
• Tender guarantees

Guarantees and letters of credit can be covered (fully or partially) and financed with a ProCredit Bank loan. The quarterly fee for issuance of guarantees and letters of credit ranges from 0.20% to 1.25% (minimum RSD 4,500), subject to the type of coverage and credit committee decision.
In addition to the above-mentioned instruments, ProCredit Bank offers:

• Stand-by letters of credit
• Letters of intent
• Acceptance of bills of exchange
• Registration of foreign loans

Our staff in the Documentary Business and Guarantees Department are there to give you professional advice regarding the structure of your business, as well as help you prepare a draft of documentary credits and guarantees.
Protect your interests, by recommending a documentary business instrument or a guarantee to your trading partners. ProCredit Bank will facilitate negotiations and help to ensure efficient use of the respective payment/security instruments.

For further information, please visit the nearest branch of ProCredit Bank.