Notice. This page is informational and general in nature. Any mandate remains subject to KYC and AML checks, sanctions screening, legal review, document compliance, underwriting, and final third-party approvals.
Revolving Letter of Credit Services
A single-use LC costs time and margin on every trade cycle. Companies with recurring import or export flows need a revolving LC facility — a standing arrangement with a bank that reinstates automatically after each drawing, without re-applying from scratch each time.
FG Capital Advisors advises on revolving LC facility setup, banking relationship structuring, facility design, and the documentation and collateral negotiations required to get a programme in place and operational.
Get StartedWho This Is For
Companies purchasing the same goods from the same suppliers repeatedly who need a standing LC line rather than one-off issuances each cycle.
Physical traders moving recurring cargo — metals, grains, petroleum products — who need an LC facility that rotates in step with their shipment schedule.
Producers sourcing raw materials on regular purchase cycles who need predictable, low-friction LC availability without re-negotiating terms each order.
Companies that have outgrown ad-hoc LC issuance and need a formal facility to support scaling trade volumes and longer supplier relationships.
How A Revolving LC Facility Works
Unlike a standard LC that expires after a single drawing, a revolving LC reinstates — either automatically after each drawing or after each defined period — up to an agreed cumulative or per-cycle limit. The facility sits on the company's balance sheet as a committed trade line, reducing friction on every subsequent trade.
| Facility Type | How It Reinstates | Best Suited For |
|---|---|---|
| Cumulative Revolving LC | Unused amounts from one period carry forward and accumulate into the next cycle. | Buyers with variable order volumes where timing of drawdowns is irregular. |
| Non-Cumulative Revolving LC | Each period's unused availability lapses; the facility resets to the full amount at the start of each new cycle. | Buyers with predictable, regular shipment schedules where unused capacity is expected. |
| Evergreen / Automatic Reinstatement | Reinstates automatically after each compliant drawing without manual renewal or bank approval. | High-frequency traders needing maximum operational continuity with minimal admin. |
| Time-Based Revolving LC | Reinstates at fixed calendar intervals — monthly, quarterly — regardless of drawings made. | Companies with fixed purchasing calendars tied to seasonal or contractual cycles. |
Full Scope Of Services
| Workstream | What We Handle | Output |
|---|---|---|
| Facility Scoping | Review trade flows, volumes, supplier base, and existing banking relationships to define the right facility size and structure. | Facility blueprint with recommended limit, tenor, and reinstatement mechanism. |
| Banking Relationship Advisory | Identify appropriate issuing banks based on geography, commodity type, counterparty jurisdictions, and collateral profile. Advise on how to approach and position the company to prospective LC banks. | Shortlist of matched banks with relationship entry strategy. |
| Collateral & Margin Structuring | Advise on cash margin, pledge arrangements, cross-collateralisation, and asset-backed support to minimise the cash tied up against the facility. | Collateral structure that optimises working capital efficiency. |
| Facility Documentation Support | Assist in reviewing and negotiating facility letters, master LC agreements, security documents, and covenants with the issuing bank's legal team. | Negotiated, execution-ready facility documentation. |
| Underwriting Pack Preparation | Build the bank submission package — financial model, trade flow summary, risk narrative, and compliance documents — to a committee-grade standard. | Bank-ready credit application file. |
| Non-Bank LC Line Placement | Where traditional bank lines are unavailable or insufficient, introduce the company to non-bank LC providers and collateral transfer specialists. | Alternative LC issuance path with indicative terms. |
Process From Intake To Facility
- Trade Flow Review Assess volumes, frequency, counterparties, jurisdictions, and existing banking relationships to determine facility parameters.
- Facility Design Define reinstatement type, cycle structure, limit size, collateral approach, and issuing bank criteria.
- Bank Identification & Positioning Identify matched issuing banks or non-bank providers and prepare the company for a credible initial approach.
- Submission Package Build Prepare the full credit application file — financials, trade evidence, risk narrative, and KYC/AML documentation.
- Negotiation Support Coordinate pricing, margin requirements, covenant terms, and reinstatement conditions through to agreed heads of terms.
- Documentation & Activation Support facility agreement review, security document execution, and first drawing to confirm the facility is live and operational.
What To Submit For A Review
- Overview of trade flows — commodities or goods, countries, volumes, and frequency.
- Existing banking relationships and any current LC or trade finance lines in place.
- Key supplier contracts or framework agreements that the facility would support.
- Corporate financials — audited accounts and recent management accounts.
- Details of any collateral available — cash, receivables, inventory, or fixed assets.
- Full KYC and AML package for the company and beneficial owners.
Why Revolving LC Applications Stall
- No existing banking relationship in the issuing jurisdiction — banks will not issue cold.
- Trade flows are too irregular or insufficiently documented to support a facility underwrite.
- Collateral position is too thin relative to the requested facility limit.
- Company financials do not reflect the trade volumes being presented.
- Counterparty or jurisdiction risk falls outside the issuing bank's appetite.
- KYC or AML documentation is incomplete, delaying credit committee review.
If your business runs recurring trade flows and you are still issuing one-off LCs each cycle, a revolving LC facility is likely the right structure. Submit your mandate for a structured intake review.
Get StartedDisclosure. FG Capital Advisors is not a bank or direct lender. Services are delivered on a best-efforts advisory basis through third-party capital providers and remain subject to underwriting, compliance checks, and definitive legal documentation.
