L/C (Letter of Credit)

What is L/C?

A bank undertaking to pay the seller once compliant shipping documents are presented, which protects both sides on larger orders. It costs more than T/T and is unforgiving of document discrepancies — a mismatched description or a missing certificate can block payment — so agree the exact document list before the L/C is opened.

At a glance

Category

Trade & logistics

Also known as

Letter of Credit · 신용장

Korean term

신용장

Last reviewed

July 23, 2026

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