Markets
Electronic Letters of Credit: Pandemic Solution Turned Standard Practice
June 28, 2022
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2 Minutes
Among the innovations the COVID-19 pandemic has spurred, electronic letters of credit remain the efficient alternative for navigating the global trade industry. While issuers side-step the obstacles of delivering hard copy documents, beneficiaries finalize deals, and receive guarantees for payment, at a fraction of the effort.
We recently hosted a Trade Finance: Electronic Letters of Credit webinar that highlighted the unique benefits of electronic letters of credit. Moderated by Chris Shaw, Director, Global Trade Finance Sales at TD Securities, the event featured operational and legal insights from Stella Carolina Stella, Group Manager, Global Trade Finance Operations at TD Securities, and Paul Roder, Partner at Moses & Singer LLP.
"TD Securities was looking very closely at electronic letters of credit over the past, few years. We implemented this to grow, become greener as an organization, and support our clients," says Chris.
Record Delivery Times
Electronic letters of credit have eliminated dependency on third-party couriers. By using email or the SWIFT messaging platform to transmit documents between clients and beneficiaries, issuers have discovered a workaround for complicated logistics. Beneficiaries across time zones can receive, and return, documents in minutes, reducing transaction times and supporting quick payment windows.
Paperless Problem-Solving
Environmentally friendly business solutions are an important focus across many industries. Electronic letters of credit are a green mandate all their own, reducing paper usage in a traditionally paper-heavy process. Typographical errors can also be fixed without printing a new document, disrupting the process, and delaying the deal.
Enhanced Operations and Reduced Risk
The COVID-19 pandemic wedged itself into business operations worldwide, sending entire teams, and processes, home. Issuing letters of credit in this environment required a solution that could guarantee delivery to beneficiaries, protect the legal integrity of the documents, and not assume additional risk. With electronic letters of credit, lost documents and courier issues are an issue of the past. In contrast to vulnerable paper documents, electronic letters of credit can also be encrypted to prevent fraud.
At TD Securities, we strike the balance between what needs to be done, and what we need to do to evolve. Across our business, we strive to make every transaction a faster, easier, and more secure experience than the one before it, for everyone involved.
To request access to the view the entire webinar, contact Chris Shaw
Director, Global Trade Finance Sales
Director, Global Trade Finance Sales
Director, Global Trade Finance Sales