Our Process and Procedure for the Issuance of Trade Finance Instruments

Category: Insider Alert
5 mins read

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Navigating the world of trade finance can be complex — but it does not have to be. At Core Trade Finance Limited, we have designed a clear, transparent, and efficient process to help importers, exporters, and project firms secure the financial instruments they need to thrive in international trade. Whether you are applying for a Letter of Credit, Bank Guarantee, or Standby Letter of Credit, here is exactly what to expect when you work with us.

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A Step-by-Step Guide to Our Issuance Process

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Step 1: Initial Application

Every successful transaction begins with a clear understanding of your requirements. Start by completing our application form or submitting your Proforma Invoice, Sales Contract, or project details. This allows our team to assess your specific needs and begin preparing accordingly. The more detail you provide at this stage, the smoother the process will be.

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Step 2: Draft Preparation

Once we have reviewed your application, we will prepare a draft of the required financial instrument tailored to your transaction. If any amendments are needed, revisions will be made until the document fully meets your requirements and those of your beneficiary.

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Step 3: Documentation Submission

To fulfil our due diligence obligations and comply with KYC requirements, we will ask you to provide the following documents:

• A brief company profile — Presentation or Executive Summary
• Certificate of Incorporation
• Company shareholding structure — principal shareholder details
• Passport copy and National Identity document of the principal shareholder
• Bank statements and tax details, where applicable

We handle all documentation with the strictest confidentiality and solely for the purpose of due diligence and compliance.

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Step 4: Due Diligence and Validation

Upon receipt of your documents, our team will conduct a thorough due diligence and validation review. If your application is approved, we will prepare the Service Agreement and Invoice for your review. This stage ensures that every transaction we facilitate meets the highest standards of legitimacy and compliance.

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Step 5: Agreement and Payment

This is a critical step and one we take seriously. Prior to issuance, both the applicant and the beneficiary are required to sign and stamp the instrument draft as approval, to avoid any disputes following issuance. The applicant must also review, sign, and return the Service Agreement as formal confirmation of acceptance, and proceed to pay the issuance fee. This step formalises the engagement and initiates the financial process.

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Step 6: Issuance of Financial Instrument

Upon receipt of the issuance fee, we will initiate the issuance of the financial instrument through our issuing bank partners via SWIFT. For clients requiring hard copy instruments, delivery will be arranged by post or courier upon request.

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Step 7: Confirmation of Receipt

Once the instrument has been successfully issued, the applicant will receive a formal confirmation of receipt along with a copy of the SWIFT transmission message. At this point the process is complete and your instrument is ready for use.

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Important Notices — What You Need to Know

Before engaging with us, please take note of the following important points:

Turnaround Time Subject to timely submission of all required documentation and receipt of the issuance fee, instruments are typically issued within five to ten banking days. Turnaround times may vary depending on the complexity of the transaction and the requirements of the issuing bank. We will keep you informed of progress throughout.

Validity of Instruments The validity period of your instrument is determined by the mutual agreement of the applicant and the beneficiary. Validity periods can range from as short as one week to thirty days, several months, or beyond one year depending on the nature of your transaction. We strongly advise confirming the required validity period at the application stage to avoid amendments post-issuance.

Applicable Rules and Governing Standards All instruments are issued in accordance with internationally recognised trade finance standards including UCP 600 for Letters of Credit, URDG 758 for Demand Guarantees, and ISP98 for Standby Letters of Credit. We encourage all clients to familiarise themselves with the relevant rules governing their requested instrument.

Hard Copy Instruments Some of our issuing bank partners can provide hard copy instruments or documents printed on bank letterhead upon request.

Usance or Deferred Letters of Credit These can be provided under strict procedures similar to Documents Against Payment terms, given that our services are unsecured. In certain cases, our issuing banks may accept consent messages via SWIFT from the beneficiary’s bank to authorise the release of documents. Additionally, some issuers may release documents where the applicant is a well-established company with a strong track record.

Amendments Post-Issuance Any amendments requested after an instrument has been issued are subject to the agreement of all relevant parties including the issuing bank and beneficiary. Additional fees may apply. We will not be held liable for delays or costs arising from post-issuance amendment requests.

Payment Methods We accept bank transfers and wire transfers only. We do not accept escrow arrangements, cryptocurrency, or any other payment methods.

Completion of Work Our engagement is considered complete upon issuance of the instrument. A copy of the SWIFT transmission message will be provided to you for your records.

Confidentiality All client information, documentation, and transaction details shared with Core Trade Finance Limited are treated with the strictest confidentiality. We do not disclose client information to third parties except where required by law or with your explicit consent. Clients are equally expected to treat all draft instruments, pricing, and correspondence from us as strictly confidential.

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Trade Finance Products We Offer

Core Trade Finance Limited provides a comprehensive range of trade finance instruments and services to businesses engaged in international trade, including:

• Letters of Credit (LC)
• Standby Letters of Credit (SBLC)
• Bank Guarantees (BG)
• Bid Bonds
• Tender Bonds
• Performance Guarantees
• Advance Payment Guarantees
• Warranty Bonds
• Indemnity Bonds
• Proof of Funds
• Ready, Willing and Able (RWA) Letters
• Comfort Letters
• Other trade and project-related financial instruments and services

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Protecting Yourself From Fraud

We feel a strong responsibility to educate our clients about the risks of fraud in the trade finance space. Please be strongly advised that terms such as “SBLC leasing,” “SBLC purchase,” “SBLC funding,” “monetisation of bank instruments,” and “investment against bank guarantee” are not legitimate trade finance practices. These terms are commonly used by fraudsters to deceive and defraud businesses.

Core Trade Finance Limited strictly does not engage in, facilitate, or endorse any such schemes. Our services are limited to the legitimate issuance of trade finance instruments as outlined in this article. Any offer made under our name that falls outside these services should be treated with the utmost suspicion.

If you are approached by anyone claiming to represent Core Trade Finance Limited in connection with any of the above schemes, do not transfer any funds or share sensitive information. Contact us directly and immediately to verify the legitimacy of any such approach. We will never cold-call clients with unsolicited offers and will never request advance fees outside of our documented issuance fee structure.

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Final Thoughts

At Core Trade Finance Limited, we are dedicated to providing reliable and professional trade finance solutions that cater to the diverse needs of businesses engaged in international trade. Our transparent and streamlined process ensures that you receive the financial support your business requires, backed by our commitment to integrity, efficiency, and excellence.

If you have any questions about our process or would like to discuss your specific trade finance requirements, contact us today. We are here to support your international trade objectives every step of the way.