A standby letter of credit is a legal payment assurance given by a bank or a financial institution to the beneficiary against any default made by its applicant (buyer). In simple words, the issuing bank guarantees the fulfillment of the buyer’s contractual obligations in case of the buyer’s incapability and offers the security of payment to the seller by reimbursing the full or remaining amount. Read more: https://www.axioscreditbank.com/blogs/standby-letters-of-credit-meaning-its-types