Standby Letters of Credit

A guarantee of last resort: the bank pays the beneficiary only if you don't. An SBLC backs a contract, a lease or a credit facility without moving any funds upfront.

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WHO IT'S FOR

Built for contract-backed assurance.

Companies on international contractsBacking a cross-border supply or service contract where the counterparty wants bank-level assurance.

Tenants on high-value leasesReplacing a large cash security deposit on a commercial lease with a bank instrument.

Businesses guaranteeing a facilitySupporting a loan, credit line or supplier facility with a standby instead of pledged cash.

Cross-border joint-venture partnersGiving an overseas partner recognised security without a direct banking relationship.

STRUCTURE & THE NUMBERS

Where this typically lands.

Indicative figures: every case is confirmed against the specific bank, transaction and applicant profile.

10–100%Cash margin, by relationship and risk

1–3%Typical annual fee

Up to 3 yrsTypical validity, renewable

5–7 daysTypical issuance once terms are confirmed

HOW IT WORKS

From request to issuance.

Confirm the underlying obligationWe identify exactly what the SBLC needs to secure — a contract, a lease, or a facility — and the wording the beneficiary expects.

Bank credit assessmentThe bank reviews your file and the cover available against the amount required.

Wording drafted to ICC standardSBLCs are drafted under recognised international rules (ISP98 or UCP600) so the beneficiary's bank accepts it without dispute.

Issued & advised to the beneficiaryThe bank issues the SBLC directly, or through the beneficiary's own bank.

Reduced, renewed or releasedThe SBLC runs alongside the underlying contract and is released once the obligation ends.

A NOTE FROM THE DESK

“An SBLC only works if the wording matches exactly what the beneficiary's own bank expects to see. That's the part we get right before it's issued.”

FREQUENTLY ASKED

Common questions.

How is an SBLC different from a bank guarantee?

Functionally similar — both pay only on default. An SBLC is drafted under international rules (commonly ISP98) and is more familiar to overseas counterparties, while a bank guarantee follows local UAE banking practice. Which one a beneficiary asks for usually settles the choice.

Can an SBLC be used to raise finance elsewhere?

We structure SBLCs to secure a genuine contract, lease or facility. We don't arrange instruments intended to be pledged or ‘monetised’ as a financing product on their own — a request framed that way isn't one we can help with.

How long does it stay valid?

Typically matched to the length of the underlying contract, up to three years, and renewable if the relationship continues.

Ready to back your next contract?

Tell us what the beneficiary requires and we'll confirm which panel bank can issue on those terms.