Sight, Usance & UPAS L/C

A #sight L/C requires the buyer to make payment once the documents have been presented and everything has been verified by the issuing bank .In other words, payment must be made at sight.

Payment: sight LC is paid immediately after presenting the documents. In case of any discrepancy, LC would be paid after acceptance / clearance of discrepancy. 

A #usance (or term )L/C requires the buyer to make payment by a specified future date (and upon of conforming document).In effect the buyer is extended a specified period of credit.

Payment: usance LC is paid after a specific period as per terms of LC. In case of any discrepancy, LC would be paid after acceptance / clearance of discrepancy. 

#UPAS (Usance Payable At Sight) It is a term of payment, where the letter of credit will be paid at "sight". This means, if all the documents are appropriate as per the "documents required" clause under any letter of credit, then the due amount will be paid immediately without the consent of Applicant. But bank will be receive the payment from applicant after a specific period as per terms of LC. (90/180/360 days)

Payment: UPAS LC is paid immediately after presenting the documents. In case of any discrepancy, LC would be paid after acceptance / clearance of discrepancy.

UPAS Benefits

• Save business costs as L/C UPAS costs less than borrowing cost
• Meet exporter’s requirement of payment at sight, and client’s needs for timely goods receipt while is still entitled to deferred payment
• Increase the possibility of contract signing with preferential conditions
• Enhance client’s competitiveness in international commercial activities