Banking · Letter of Credit
What is reimbursement in the context of a documentary credit transaction?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The issuing bank reimburses the advising or negotiating bank for the payment made to the seller.✓
- 2The buyer repays the issuing bank for the cost of opening the LC.
- 3The bank reimburses the buyer for the cost of the goods.
- 4The buyer reimburses the seller directly for the goods purchased.
Correct answer
The issuing bank reimburses the advising or negotiating bank for the payment made to the seller.
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