What do you mean by a 'Negotiating Bank' under Letter of credit?

Negotiating Bank

 

Negotiating bank is one of the main parties involved under Letter of Credit. Negotiating Bank,is the one who negotiates documents delivered to bank by beneficiary of LC. Negotiating bank is the bank that verifies documents and confirms the terms and conditions under LC on behalf of beneficiary to avoid discrepancies. The bank after satisfying itself that the documents conform with the letter of credit, agrees to either credit or pay the seller immediately under the terms of the letter of credit, or credit or pay the seller once it has received payment from the issuing bank.


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