| Standby letter of credit is widely used internationally since in 1977, particularly in Europe and the United States and other developed countries. The applications are no longer limited to the scope of the original warranty, but more used in international settlement and international trade finance and other fields. Compared with foreign countries, our country's standby letter of credit's application is not only started late but the scope and ratio of its application can not be compared with Europe and the United States. Thus, there is great practical significance for promoting standby letter of credit to be widely used in understanding fully standby letter of credit at home and abroad, borrowing form the advanced experience of developed countries' application in standby letter of credit, deep understanding the nature and characteristics of standby letter of credit, accurately determine the risk of the standby letter of credit.This paper reviewed the research results related to standby letter of credit, re-combed the nature, characteristics and related practices of the standby letter of credit, highlighted the most relevant international practice ISP98 with standby letter of credit, combined with the practical case to explain the application process of standby letter of credit. This paper introduced the application status of standby letter of credit in the United States, Japan, France and Latin American, summarized the characteristics of their applications is the largest country of application is the United States, the number of its applications is annual increasing, its applications has large proportion in the clearing tools, the experience drawn on standby letter of credit is perfecting relevant laws, increase awareness of standby letter of credit. Compared with the standby letter of credit's application status in our country, analyzed the reason that standby letter of credit has not been widely used is our country's laws relevant with standby letter of credit is not perfect, has strict supervision on the use of the standby letter of credit and lack deep understanding of standby letter of credit, and proposed relevant measures for those reasons in order to promote to use the standby letter of credit in our field of international economic and trade. And on this basis, we analyzed the possible risks faced in real applications with examples, proposed relevant measures of risk prevention and relief. |
