An irrevocable letter of credit definition is basically a letter of credit which cannot be cancelled. It is issued to a creditor who is buying goods or service oversees to give to international sellers in lieu of cash. This gives the seller the assurance that they will be paid for their service as the letter cannot be revoked.
The letter must be original and it should be written on the issuing bank’s letterhead. It should also include the date issued and the letter of credit number. It is important that these are included to verify the authenticity of the document to be used as a credit instrument.
All relevant applicant information should be clearly outlined on the irrevocable letter of credit. The applicant’s full name and address should be clearly stated on the bank letter. If this is not done, the letter will not be accepted and will be returned to the applicant to have it redone.
Other things to include
The letter of credit should also include the beneficiary’s name and address, the bond amount, the project name and address and the date and place of expiration which should be one year longer than the date executed on the bond agreement. It is important to strictly adhere to the letter of credit terms so you should careful review all the relevant documents and information before you submit them.