Definition:

Discount of Letter of Credits, drafts or export commercial documents, affecting the credit line of the exporter. In this case, Citibank^® advances funds to its customer, but in case the importer does not honor the payment, the exporter has to cancel the transaction at maturity.

Advantages:

	The exporter can sell with credit terms and thus receive the funds immediately.
	A good alternative when the exporter trusts in the repayment capacity of his customer and has an available credit line.

Costs:

Spread over a base rate or fixed rate for the remaining period of the documents.

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