Account Party

Account Party

Party who applies to open a bank for the issuance of a letter of credit.

Account Party

An importer or other buyer that applies for a letter of credit from a bank. The account party, upon receiving the letter of credit, is able to guarantee the exporter (or other seller) that it will receive payment for the goods shipped even if the account party itself defaults.
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The Account party must provide an acceptable guarantee for the beneficiary to pay a certain sum to him/her in the occurrence of specific terms.
Considering applications of letter of credit, preventing from the assignment of revenues leads to valid and significant benefits for the account party.
A letter of credit is a written agreement to pay money that involves three parties: (1) an account party (the tenant); (2) an issuer (typically, a bank); and (3) a beneficiary (the landlord).
To make payment on behalf of the account party, in the event that the account party fails to fulfill its obligation to the beneficiary.
A standard, negotiable, irrevocable, import L/C - as illustrated in the exhibit - by definition, is a written undertaking issued by a bank, acting at the request and on instructions of its customer (the applicant for the credit, account party, or buyer), in which the bank obligates itself to -
A letter of credit is a written agreement to pay money that involves three parties: (1) an account party (the debtor); (2) an issuer (typically, a bank); and (3) a beneficiary (the creditor).
What happens if the beneficiary presented all of the required documents, but received more from the letter of credit issuer than the beneficiary was owed under its contract with the account party for which the letter of credit had been posted as security?
Where an LC is the method of payment of the purchase price of goods, the seller is the LC beneficiary, the buyer is the LC account party or applicant and the bank issuing the LC is the LC issuer.
When the letter of credit is the method of payment of the purchase price of goods to the seller, the seller is the LC beneficiary, the buyer is the LC account party or applicant and the bank issuing the LC is the LC issuer.
Our American seller would be the LC beneficiary, the Mexican buyer would be the LC account party and the reputable American bank is the LC issuer.
Our American furniture seller would be the L/C beneficiary, the Mexican buyer would be the L/C account party and the reputable American bank is the L/C issuer.
In a transaction secured by a direct pay letter of credit, the beneficiary and account party expect the issuer to honor the letter of credit upon submission of the draft and the documents of title covering the shipped merchandise.