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A sight L/C requires the buyer to make payment once the documents have been presented and everything has been verified by the issuing bank .In other words ,payment must be made at sight.
A usance (or term )L/C requires the buyer to make payment by a specified future date (and upon of conforming document).In effect the buyer is extended a specified period of credit
Please note that the term usance is not specifically referenced in UCP600,where it states “ aA credit must state whether it is available by sight payment, deferred payment, acceptance or negotiation.
A Sight L/C requires the buyer to make payment once the documents have been presented and everything has been verified by the issuing bank .In other words ,payment must be made at sight.
A Usance (or term )L/C requires the buyer to make payment by a specified future date (and upon of conforming document).In effect the buyer is extended a specified period of credit
Sight LC is paid immediately after presenting the documents is ok whereas usance LC if the documents is ok it will be paid a specific period as per terms of LC
The sight credit means upon Bill of Exchange is presented at counter, it must be paid there immediately while usance credit, Bill is presented & accepted then pay for it. it usually cover a terms of 30, 60 or 90 days
Usual period allowed for payment of a bill of exchange (such as a check or draft), especially in international trade. Usance does not refer to a fixed period but varies according to customarry practice in that trade or between the countries involved.(usance credit). A letter of credit that is payable as soon as the required documents have been presented.( sight L/C credit)
Sight LC is paid immediately after presenting the documents whereas usance LC is paid after a specific period as per terms of LC.
In case of any discrepency, LC would be paid after acceptance / clearance of discrepency.
