Application of letter of credit in international trade

Abstract

In today's world, with the rapid development of economy, many countries have kept up with the pace of economic globalization, and international trade is becoming increasingly important. As a settlement method with banks as guarantors of both parties, L/C (letter of credit) is much safer than commercial credit, and has become the choice of most buyers and sellers in international trade. The purpose of this paper is to introduce the L/C and discuss its advantages and disadvantages in various situations in the application of international trade, and put forward relevant improvement measures.