Draft LC Checklist
Two tools in one: a 27-point structured draft-LC review across 9 risk categories, and a parametric auto validator that flags discrepancies from Incoterm, date and tenor inputs.
Walk your draft LC through 9 risk categories. Paste an MT700 to auto pre-check items. Progress and notes save locally.
Why this matters | Legal-name mismatches are the fastest way to a discrepancy. UCP 600 Art. 14(d)–(j) treats data across documents as inconsistent if names or addresses do not match the credit.
Why this matters | UCP 600 Art. 30 governs amount/quantity tolerances. Missing ‘about’ language or wrong currency wording is a common cause of rejected drawings on bulk cargo.
Why this matters | UCP 600 Art. 14(c) defaults presentation to 21 days after shipment if the credit is silent. Tight expiry vs shipment is the single largest source of avoidable rejections.
Why this matters | UCP 600 Art. 31(a) allows partial shipment and Art. 20(c) allows transhipment for containerised cargo unless expressly prohibited. Silence is a decision | make sure it matches your shipping plan.
Why this matters | Field 46A is the highest-risk field in the entire credit. Every required document must be obtainable in the wording specified | carriers, insurers and chambers will not deviate from their standard forms.
Why this matters | Under CIF and CIP the seller must insure. If the LC requires an insurance certificate but the Incoterm places insurance on the buyer, you have a discrepancy waiting to happen (UCP 600 Art. 28; Incoterms 2020).
Why this matters | UCP 600 Art. 18(c) requires the invoice description to correspond with the credit description. Overloading Field 45A with detail the packing list or B/L cannot reproduce guarantees a discrepancy.
Why this matters | Field 40E should reference the governing rules explicitly. For SBLCs, choose UCP 600 for documentary mechanics or ISP98 for pure financial standbys. Silent confirmation status is the most common commercial LC oversight.
Why this matters | UCP 600 Art. 14(h) requires banks to disregard non-documentary conditions. Leaving them in creates ambiguity and delayed drawings even though they are legally unenforceable.
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Numerical Example: Critical Tenor Discrepancy
In this scenario, the LC expires before the presentation period ends (counting from the latest shipment date), making it impossible to present documents if shipment occurs late in the window.
UCP 600 Article Compliance
Compliance with UCP 600 (Uniform Customs and Practice for Documentary Credits) is the bedrock of trade finance. Most discrepancies arise not from the inability to ship, but from clerical errors in document descriptions or miscalculations of date tenors. A structured review using ISBP 821 (International Standard Banking Practice) ensures that your presentation will be honored by the issuing bank.
Frequently asked questions
What are the most common LC discrepancies?
Late shipment, credit expired, description mismatch between invoice and LC, transport document not on-board, missing endorsements, weight or quantity outside tolerance, and inconsistent data across documents. All are examined under UCP 600 Art. 14 and ISBP 821.
What is the UCP 600 quantity tolerance?
Under UCP 600 Art. 30(b), a ±5% quantity tolerance is permitted where the quantity is not stated in packing units or individual items, and provided the total drawing does not exceed the credit amount. Article 30(a) allows a ±10% 'about'/'approximately' tolerance on both the credit amount and the quantity.