Important Disclosure. For corporate sponsors and accredited investors. Not a public offer. Local restrictions may apply. Prepared by FG Capital Advisors, August 2025.
DLC at Sight for Commodity Trades
DLC at Sight is a Documentary Letter of Credit that pays the beneficiary upon compliant presentation. For commodity trades, this is the cleanest way to swap counterparty risk for bank risk and get paid against documents. The importer’s bank issues under UCP 600; reimbursement can involve a reimbursing bank under URR 725. If the beneficiary will not take issuing bank or country risk, add a confirming bank. Keep the text tight, the docs clean, and the collection happens at sight.
What It Is, When To Use It
Plain Definition
Bank undertaking to pay on first presentation of compliant documents. No waiting for buyer funds if terms are met.
Best Use Cases
Bulk and break-bulk shipments, metals, agri, energy cargoes, FOB/CFR/CIF where documentary control matters.
Why Sellers Like It
Cash against bank risk at presentation. Better cash flow and lower default exposure than open account.
Why Buyers Accept It
Secures performance, improves supplier access, and can be paired with insurance or participation to manage limits.
How A Sight DLC Pays
Payment is against compliant presentation. If confirmation is added, the confirmer pays even if the issuer fails, subject to the same compliant set.
Text & Document Essentials
Document Set
Commercial invoice, clean on-board bill of lading, packing list, certificate of origin, inspection/assay if agreed, and insurance where required by Incoterms.
Presentation Terms
Specify presentation location, latest shipment, and presentation period. Avoid vague clauses that trigger discrepancies.
Rule Set & Charges
UCP 600 governs. Split charges clearly: who pays confirmation, advising, amendments, and reimbursement fees.
Confirmation Option
Add confirmation where the seller requires a stronger bank or where country risk is high. This often unlocks better pricing and faster pay.
Indicative Pricing Examples
| Case | Face Value | Tenor | Key Terms | Indicative Cost To Applicant |
|---|---|---|---|---|
| Sight DLC With Confirmation | USD 10,000,000 | Pay at sight | Confirmation 0.6–1.0% p.a. prorated to risk period; advising & messaging flat | ~USD 80k–120k plus flats |
| Sight DLC, No Confirmation | USD 5,000,000 | Pay at sight | Issuer fee only; standard advising | ~USD 25k–45k plus flats |
| Confirmed DLC With Insurance | USD 20,000,000 | Pay at sight | Confirmation narrowed by insurance; distribution to participants | Case-specific; insurance premium traded for lower confirm |
Numbers are directional. Final pricing depends on issuing bank rating, country risk, currency, liquidity, and file completeness.
Common Failure Points & How We Prevent Them
Dirty LC Text
We draft against the contract, keep conditions objective, and pre-clear with advising or confirming banks.
Discrepancies
We run a pre-shipment doc plan and a mock presentation so the first real set is clean.
Limit Constraints
We line up a confirmer or insured route before you lock commercial terms, so issuance does not stall.
Country/Bank Risk
We add confirmation or insurance where the beneficiary will not accept issuer risk. No wishful thinking.
Why Sponsors Hire FG Capital Advisors For DLC At Sight
Bank & Corridor Fit
We match you to issuers and confirmers that actually hold live limits for your route and cargo category.
Drafting That Collects
UCP 600 text, crisp presentations, and reimbursement terms that lead to real pay at sight.
Pricing Options, Not One Shot
Issuer-only, confirmed, insured, or participated. We price the stack and let you choose.
Close-Time Discipline
Single drafting owner, fixed review windows, escalation paths. Less email noise, faster issuance.
What You Receive
Bank Shortlist
Three to five issuers/confirmers with appetite for your corridor and tenor.
Draft LC Text
Clean documentary conditions aligned to Incoterms and your sales contract.
Pricing Pack
Issuer, confirmation, and ancillary fees with scenarios.
Timeline & Cut-Offs
Dates per step and known bank windows so you can ship on time.
Risk Options
Confirmation, insurance, and participation routes if limits are tight.
Execution Support
Hands-on coordination up to issuance and first compliant presentation.
Need A DLC At Sight For Your Next Commodity Shipment?
Share route, cargo, value, and ship dates. We will scope the bank path, draft the text, and drive to issuance.
Start Your Trade Finance RequestDLC At Sight — FAQs
Is A DLC At Sight Better Than Open Account For Commodities?
For new or higher-risk counterparties, yes. You trade buyer risk for bank risk and get paid on compliant documents.
When Do I Need Confirmation?
When the seller will not take issuing bank or country risk. Adding a respected confirmer also speeds acceptance and pay.
Can A Sight DLC Be Refinanced Into Credit Terms?
Yes. Post-import loans or trust receipts can extend terms for the buyer; exporters can discount accepted drafts where applicable.
Which Documents Are Non-Negotiable?
Correctly consigned clean on-board B/L, commercial invoice, and any mandatory third-party certificates (inspection, assay, origin) named in the LC.
Are Broker “Leased LC” Offers Real?
No. Banks do not sell LCs at a fraction of face value. Avoid broker chains promising monetization.
How Fast Can We Issue?
With a complete file and aligned text, simple cases can finish in days. Complex corridors or heavy confirmation needs take longer.
Disclaimer. Structures and prices are indicative and depend on credit, limits, country, currency, and documentation quality. FG Capital Advisors provides advisory and arrangement services only.
