Consider a bank that acknowledges that it will make payments on behalf of a beer importer after the beer is delivered to the importer. This reflects:

Question

Consider a bank that acknowledges that it will make payments on behalf of a beer importer after the beer is delivered to the importer.  This reflects:

Quizplus · Accepted Answer

This is an example of a letter of credit, where the bank agrees to make payments on behalf of the importer to the exporter once the goods are delivered. This provides security to both the importer and exporter in the transaction. Accounts receivable financing, forfaiting, and factoring involve different types of financing arrangements and do not apply in this scenario.

Consider a Bank That Acknowledges That It Will Make Payments