Important Disclosure. For corporate sponsors and accredited investors. Not a public offer. Local restrictions may apply. Prepared by FG Capital Advisors.
DLC at Sight for Commodity Trades
DLC at Sight is a Documentary Letter of Credit that pays the beneficiary upon compliant presentation. For commodity shipments, this replaces buyer risk with bank risk and delivers collection 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 objective, keep the documents clean, and collection occurs at sight.
What It Is, When To Use It
Plain Definition
Bank undertaking to pay on first presentation of compliant documents. No dependency on buyer cash movement if terms are met.
Best Use Cases
Bulk and break-bulk, metals, agriculture, energy cargos, FOB/CFR/CIF where documentary control is central to risk transfer.
Why Sellers Choose It
Cash against bank risk at presentation. Improved cash conversion and lower default exposure versus open account.
Why Buyers Accept It
Secures performance, widens supplier access, and can be paired with confirmation 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 And Document Essentials
Document Set
Commercial invoice, clean on-board bill of lading, packing list, certificate of origin, inspection or assay where required, and insurance where Incoterms demand it.
Presentation Terms
Specify presentation location, latest shipment date, and presentation period. Avoid soft conditions that trigger discrepancies.
Rule Set & Charges
UCP 600 governs. Define who bears advising, confirmation, reimbursement, and amendment charges in the LC text.
Confirmation Option
Add confirmation where the seller requires a stronger bank or where country risk is elevated. This often accelerates acceptance and settlement.
Indicative Structures And Terms
| Structure | Face Value | Risk Enhancements | Notes |
|---|---|---|---|
| Sight DLC With Confirmation | Programmatic, case by case | Confirming bank, optional participation or insurance | Used when seller will not accept issuer or country risk. Settlement at sight against clean documents. |
| Sight DLC, No Confirmation | Programmatic, case by case | Issuer-only, reimbursement under URR 725 | Suitable where issuer rating and corridor risk are acceptable to the beneficiary. |
| Confirmed DLC With Risk Distribution | Programmatic, case by case | Confirmation plus participation or insurance | Applied where limits are tight or corridors require syndication for capacity. |
Illustrative only. Final terms depend on issuer rating, corridor risk, currency, shipment cadence, and documentation quality.
Common Failure Points And How We Prevent Them
Dirty LC Text
We draft against the contract, make conditions objective, and pre-clear with advising or confirming banks.
Discrepancies
We run a pre-shipment document 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 Or Bank Risk
We add confirmation or risk distribution where the beneficiary will not accept issuer exposure.
Why Sponsors Hire FG Capital Advisors For DLC At Sight
Bank And Corridor Fit
We match you to issuers and confirmers that hold live limits for your corridor and cargo category.
Drafting That Collects
UCP 600 text, crisp presentations, and reimbursement mechanics that lead to real pay at sight.
Structure Options
Issuer-only, confirmed, insured, or participated. We design the stack and sequence approvals.
Close-Time Discipline
Single drafting owner, fixed review windows, escalation paths. Less noise, faster issuance.
What You Receive
Bank Shortlist
Three to five issuers or confirmers with appetite for your corridor and tenor.
Draft LC Text
Objective documentary conditions aligned to Incoterms and your contract.
Execution Calendar
Cut-offs and bank windows mapped to shipment dates.
Risk Options
Confirmation, insurance, and participation routes where capacity is constrained.
Presentation Support
Hands-on coordination to first compliant set and collection at sight.
Governance
Clear roles, document custody, and SWIFT verification practices.
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 and collection.
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. A respected confirmer can also speed acceptance and payment.
Can a sight DLC be refinanced into credit terms?
Yes. Post-import loans or trust receipts can extend terms for the buyer; exporters can use discounting where applicable.
Which documents are non-negotiable?
Correctly consigned clean on-board bill of lading, commercial invoice, and any mandatory third-party certificates named in the LC.
Are broker “leased LC” offers real?
No. Banks do not sell LCs at a fraction of face value or monetize them as cash. Avoid such offers.
How fast can we issue?
With a complete file and aligned text, straightforward cases complete quickly. Complex corridors or heavy confirmation needs take longer.
Disclaimer. Structures are illustrative and depend on credit profile, limits, country, currency, and documentation quality. FG Capital Advisors provides advisory and arrangement services only.
