Sight Letter of Credit: How Payment Works
How a sight Letter of Credit pays the exporter once compliant documents are presented.
Reviewed by LCCheck team (owner-approved) · 2026-10-12
Short answer
A sight Letter of Credit is payable as soon as the bank determines that the documents comply. The bank has up to five banking days after presentation to examine them (UCP 600 Art. 14(b)); once compliant, the nominated or issuing bank pays. In the MT700, field 41a shows availability 'by payment' and 42C may show 'at sight' for drafts.
| Payment | When documents are found compliant |
|---|---|
| Examination | Up to five banking days |
| MT700 | 41a by payment; 42C at sight if a draft is required |
Benefits
- Fastest payment option.
- No maturity to wait for or discount.
Watch for
- Discrepancies still delay payment.
- Courier time adds to the total.
Sources
- ICC — UCP 600 (Uniform Customs and Practice for Documentary Credits)
- Swift — MT700 Issue of a Documentary Credit (category 7 standards)
General guidance, not legal advice. Your bank examines documents independently.
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