Russia's Sberbank has launched an agent programme to make letters of credit (L/Cs) more available for a variety of uses not connected with international trade.

The programme is aimed at companies and sole traders acting as intermediaries in transactions involving sales of property, goods and services in Russia.


The bank says agents may include trading platforms as well as law and consulting firms that will be paid commission for each L/C transaction they introduce.

The programme provides special terms for agents in the commercial and residential property market, where L/Cs are most widespread in Russia today according to Sberbank.

L/C opening options

Clients can open L/Cs remotely at an agent's office or contact a bank branch where an L/C for a transaction will be prepared for them.

L/Cs can also be opened using the Sberbank mobile app on which a transaction's progress can be followed remotely.

Increasingly popular

Sberbank's head of trade finance, Evgeny Kravchenko, says that the legal mechanisms governing L/C transactions provide maximum protection for both buyers and sellers, making L/Cs popular in Russia for a variety of purposes.

"This banking instrument has long been used in international trade and is becoming increasingly popular in Russia" he says.

"Until recently, L/Cs were primarily used in real estate transactions, but now the range of transactions is growing considerably," adds Kravchenko who says L/C transactions now include payments under services and settlement agreements as well purchases of a wide range of goods from vehicles to furniture.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.