What is LC discounting, and when does it make sense?
How exporters turn a usance letter of credit into cash today, what it costs, and the questions to ask before you discount.
Read · 6 minMany exporters discount with the one bank they already know. That is convenient, but it gives them no way to know whether the rate is fair.
How a sealed bid works
Each financier sees the same listing, pre-check result and documents, and submits a rate. No financier can see the others' bids. The exporter sees all of them, side by side, with the amount they would receive.
Why it helps both sides
- Exporters see competing prices for the same paper, and choose on rate and conditions.
- Financiers compete on price and appetite, not on relationships, and reach exporters they would never have met.
- Nobody can "anchor" on another bid, so each financier prices its own view of the risk.
On GIX Credit, bids are sealed by the database itself: a financier's screen can only ever load its own bid.