1. Overseas company A opens a foreign currency account in the offshore department of our bank, deposits foreign currency funds or obtains a credit line; Domestic company B (which must be a foreign-funded enterprise) opens a RMB account in a domestic institution of the bank;

2. The domestic institutions of the Bank complete the examination and approval of the RMB loan amount of domestic company B with the offshore standby letter of credit as the guarantee condition;

3. The offshore department of China Merchants Bank will open a standby letter of credit with a deposit or credit line of 65,438+000% in favor of the domestic branch where Company B opens an account in the bank.

4. After receiving the above standby letter of credit, domestic institutions of the Bank will issue RMB loans to domestic company B. ..

Business process:

1. Overseas company A (standby letter of credit applicant) submits standby letter of credit application;

2. The offshore business department of the head office of the bank shall open a standby letter of credit;

3. Domestic institutions of commercial banks issue RMB loans to domestic company B (RMB loan applicants of foreign-funded enterprises).

Extended data:

Application fields of standby letter of credit financing:

1. Financing standby letter of credit mainly supports the performance of payment obligations, including loan repayment, and is widely used in international credit financing arrangements.

2. Overseas-invested enterprises can obtain credit fund support from the host country through financing standby letter of credit according to ownership arrangement and project operation needs.

3. In practice, account overdraft is a good financing option.

Precautions:

The financing standby letter of credit is irrevocable. Unless otherwise stipulated in the standby letter or agreed by the other party, the issuer shall not modify or cancel its obligations under the standby letter.

References:

Baidu encyclopedia-standby letter of credit financing