Standby letter of credit

A Standby Letter of Credit (SBLC) serves as a safety net for transactions, providing assurance to beneficiaries that they will receive payment in the event the applicant fails to fulfill their contractual obligations. Unlike a DLC, an SBLC is not intended for routine payments but rather as a guarantee of payment in exceptional circumstances. This instrument is widely used in various industries to enhance creditworthiness and secure contracts, offering protection against non-performance or default.