The difference between packaged loans under domestic letters of credit and negotiation by the seller of domestic letters of credit is that -

The former is usually before the letter of credit is utilized, in other words, the beneficiary receives After receiving the letter of credit, deposit the original copy of the letter of credit with the bank and promise to negotiate (deliver the document) at the bank when the document is presented in the future, thereby obtaining part of the loan from the bank to purchase raw materials or purchase goods under the letter of credit. The latter is to obtain an amount equal to the amount of the letter of credit from the bank by transferring the accounts receivable under the letter of credit to the negotiating bank after the beneficiary delivers the goods and documents, and if the documents are consistent. Price (deducting negotiation fees and interest from the date of presentation to the time when payment is expected to be received from the issuing bank).

To summarize:

1. The time periods are different - the former is before the letter of credit is utilized; the latter is after the letter of credit is utilized.

2. Different natures - the former is a credit loan, and the latter is a transfer of income rights.

3. The amounts are different - the former can only lend up to 70-80% of the amount of the letter of credit, while the latter is the full amount of the letter of credit.