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      • A letter of credit is a guarantee from a bank that it will make good on a buyer's financial obligations to a seller in a transaction. A confirmed letter of credit is a guarantee from a second bank that it will pay the seller if the first bank fails to do so. The confirmed letter decreases the risk of default for the seller.
      www.investopedia.com/terms/c/confirmed-letter-credit.asp

      Confirmed Letter of Credit: Definition, Example, vs. Unconfirmed

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  3. www.investopedia.com › confirmed-letter-creditConfirmed Letter of Credit: Definition, Example, vs. Unconfirmed

    Mar 20, 2023 · A confirmed letter of credit is a guarantee from a second bank that it will pay the seller if the first bank fails to do so. The confirmed letter decreases the risk of default for the...

    • Julia Kagan

  4. www.investopedia.com › ask › answersBank Guarantee vs. Letter of Credit: What's the Difference?

    Apr 27, 2023 · An irrevocable letter of credit ensures the buyer is obligated to the seller. A confirmed letter of credit comes from a second bank, which guarantees the letter when the first one has...

    • Troy Segal

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  6. www.investopedia.com › ask › answersTypes of Letters of Credit - Investopedia

    Mar 7, 2024 · A confirmed letter of credit involves the addition of a confirmation by a bank other than the issuing bank, typically the seller's bank. This confirmation...

  7. www.letterofcredit.biz › index › 2018/01/22Confirmation and Confirmed Letter of Credit | Letterofcredit ...

    Jan 22, 2018 · Confirmation eliminates country risks and insolvency risk of the issuing bank. With a confirmed letter of credit, another bank, the confirming bank, usually located in the same country that the exporter is located, will add its confirmation to the letter of credit.

  8. efinancemanagement.com › sources-of-finance › confirmed-Confirmed Letter of Credit | Definition, Why, Parties, Vs ...

    Jun 11, 2022 · A confirmed letter of credit is a letter of credit in which the seller or exporter has a payment guarantee from a second bank or a confirming bank, i.e., in case the first bank fails to pay, then the payment will be made by the second bank.

  9. www.tradefinance.training › blog › articlesWhat is a confirming bank under a letter of credit?

    Oct 10, 2016 · What is a confirming bank under a letter of credit? 10/10/2016. Confirmation is normally requested by a beneficiary at the time of agreeing the sale of goods, or agreeing to provide services or performance, and is usually a pre-condition inserted in the proforma invoice or sale contract.

  10. www.sofi.com › learn › contentWhat Is a Confirmed Letter of Credit? - SoFi

    May 25, 2024 · They essentially mean that a second bank will pay the seller if the first bank fails to do so, which can inspire confidence and allow a deal to go through. Here’s a closer look at what a confirmed letter of credit is, how it works, and its pros and cons.