Show TOC

 Forwarding the Letter of Credit Information

Purpose

Foreign trade is frequently handled through a letter of credit (LoC) transaction, which is a written agreement from a bank to the seller, at the request of and instructions from the buyer. Most acceptable LoCs are confirmed and irrevocable; they are known as clean LoCs. The business ratio funded by a LoC varies by client and location.

For more informationen about the purpose of LoCs and how to use letters of credit processing in SAP Global Trade Services (SAP GTS), see SAP Library at help.sap.com under Start of the navigation path Documentation Next navigation step SAP xApps Next navigation step SAP Global Trade Services Next navigation step Release 7.1 Next navigation step SAP Risk Management Next navigation step SAP Risk Management - Letter of Credit Processing. End of the navigation path

Process Flow

  1. Create sales order (SAP CRM).

    The LoC is maintained in SAP GTS as master data. If the LoC is required for a sales transaction in SAP Customer Relationship Management (SAP CRM), it is retrieved from SAP GTS.

  2. Create unchecked outbound delivery (SAP ECC).

    The delivery is created and the LoC is stored in that delivery with the LoC number for identification.

  3. Convert unchecked delivery into checked delivery (SAP ECC).

  4. Create outbound warehouse request (WHR) (SAP EWM).

The ERP system replicates the outbound delivery with the LoC details to SAP EWM so that deliveries with different LoCs are not combined Once the delivery is replicated in SAP EWM, LoC details, such as the expiration date, are validated by calling SAP GTS .

  1. Complete the goods issue process (SAP EWM and SAP ECC).

    Note Note

    SAP EWM does not pack different LoCs into one delivery.

    End of the note.

  2. Generate the billing (SAP CRM).