Transferable DC

• Lowers barriers to entry and allows you to trade more as no capital or credit facilities are required in transferring the DC
• Maximizes business growth as you can direct your financial resources to other areas in need.
• Allows you to make payments to your supplier while protecting yourself from buyer payment default
• Mitigates risk as payment is guaranteed by Issuing Bank (provided the documents comply) and funds released to supplier only upon receipt
• Provides assurance that you can fulfill the terms of the Transferable Credit, despite any transfer of rights and obligations thereunder, as your supplier must follow very similar terms


As an intermediary party, do you find it difficult to match buyer and supplier payments? Have you ever encountered any problem in securing funds or arranging credit facilities to finance transactions? With an HSBC Transferable Documentary Credit, you can leverage your resources to finance transaction of larger volume by transferring your buyer's credit.

A Transferable DC is basically a normal DC that can be transferred by you (First Beneficiary/Transferor) to another supplier (Second Beneficiary/Transferee). There can be a number of second beneficiaries if the DC allows for partial shipment, but a DC cannot be further transferred by a second beneficiary. It is normally used when you do not supply the merchandise yourself, but you are middleman and you wish to transfer part, or all, of your rights and obligations to the actual supplier(s).

In a Transferable DC transaction, at most, you are allowed to substitute the invoice and draft only. Also, you may not have full flexibility to set your own terms as only the price, expiry date, shipment dates, presentation period and insurance percentage (if any) of the original DC can be changed.

As payment is usually released to the transferee after receipt from the issuing bank, you do not require a facility in order to effect a transfer but simply enjoy your profit by arranging the trade between buyer and ultimate supplier. Transferring documentary credits is simple. For details, please see our guide to transferring DCs.

For further information, please call our Customer Service Centre on 4 4722 24 or stop by at your nearest HSBC branch.You could also contact us via e-mail.