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Can an LC be payable later without using a bill of exchange?
Acceptance, Deferred Payment and Negotiation
Separate three LC availability/financing ideas.
Acceptance
An acceptance credit can involve a time draft drawn on a specified drawee and accepted for payment at maturity.
Deferred payment
A deferred-payment credit can create a future payment obligation without requiring a bill of exchange.
Negotiation
Negotiation concerns a nominated bank purchasing/advancing against drafts and/or documents under the credit framework.
Why wording matters
“60 days after sight” alone is not enough to identify the entire mechanism. Read fields for availability, drafts/drawee and payment tenor.
Source / standards noteThis lesson uses original plain-English explanations. Read the credit, UCP 600 and current bank practice for a live transaction.
Remember thisUsance describes future timing; acceptance, deferred payment and negotiation describe different mechanisms.
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