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Trade Finance and Services

Enhance the efficiency and security of your import and export transactions with QIB’s Shari’a-compliant trade finance solutions, including Letters of Credit, Bank guarantees, Documentary collections, and structured financing, designed to support your working capital needs, mitigate trade-related risks, and enable seamless cross-border transactions through our extensive international network of correspondent banking partners.

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Products & Services

Import Letter of Credit

Letters of Credit (LCs) issued by QIB provide security and peace of mind for both you and your suppliers by reducing the inherent risks of international trade. Under this arrangement, QIB substitutes its creditworthiness for that of the applicant, guaranteeing payment for goods and services within agreed timeframes, but only when the seller presents the documentation complied with terms and conditions of the LC. This protects buyers from non-delivery and sellers from non-payment.

Why choose QIB's Letter of Credit service?

Backed by financial stability: QIB's strong credit rating and capital base give your suppliers confidence in guaranteed payment.

Guided by trade finance experts: Our specialists help you navigate documentation requirements and ensure compliance with international trade regulations.

Flexible payment terms: Choose between immediate payment (sight LC) or deferred payment terms to improve your cash flow.

Multiple LC structures available: We offer specialized LC types to match your specific trading scenarios and supplier relationships.

Types of Letters of Credit:

Back-to-back LC: Ideal for intermediary traders, allowing you to issue an LC for your supplier using another LC as collateral.

Transferable LC: Transfer all or part of your LC to secondary supplier(s) if or when you're not the actual manufacturer or service provider.

Standby LC: Acts as a payment guarantee if the buyer fails to meet contractual obligations.

Revolving LC: Perfect for regular shipments, as, in this aspect, one LC covers multiple transactions over a set period.

Forms of Letters of Credit issued by QIB

  • Current Account LC
  • Murabaha LC
  • Wakalah LC
  • Mudaraba LC

Export Letter of Credit

At the request of the customer, QIB advises the LC, with or without confirmation, to the beneficiary (exporter) directly or through another advising bank, by providing exporters with greater confidence in shipping goods and receiving payment.

QIB offers prompt and efficient Letters of Credit services for exporters, including advising, confirmation, document scrutiny, , payment and negotiation services. Our LC confirmation service is particularly valuable when exporter(s) deal with unfamiliar international buyers or banks that may not provide sufficient assurance or creditworthiness.

By requesting QIB to confirm your export LCs, you benefit from QIB’s independent undertaking to honour or negotiate, subject to documents being presented in full compliance with the terms and conditions of the credit and in accordance with UCP.

At QIB, our dedicated team of experienced professionals, supported by state-of-the-art systems, ensures that documents are reviewed to the highest standards. Documents are examined in accordance with international standard banking practice (ISBP) and UCP 600, and pre-checked documents are processed seamlessly, minimizing the risk of discrepancies. We are committed to delivering outstanding service by ensuring timely negotiation and dispatch of all documents.

As part of our commitment to excellence, we also offer a safe-keeping service for original documentary credits, while providing beneficiaries with working copies to facilitate accurate and efficient document preparation.

These forms help you apply for a Letter of Credit, request changes, and manage Murabaha‑based trade transactions.

A Letter of Guarantee (LG) issued by QIB is a bank’s irrevocable undertaking to pay a beneficiary upon receipt of a compliant demand, if our customer fails to fulfil a contractual obligation. This provides security for both parties in business transactions enhancing trust between counterparties and supporting customers in meeting their contractual commitments.

Types of Letters of Guarantee

Payment guarantee

Assures suppliers that they'll receive payment for goods or services delivered to the buyer. QIB issues this guarantee on behalf of the buyer, subject to the terms and conditions of the guarantee, giving the supplier confidence to fulfil the order.

Bid bond

Required when bidding for large contracts or projects. QIB issues this guarantee on behalf of the bidder to assure the project owner that the bidder is serious and financially capable. If the bidder withdraws or fail to honour the bid terms, after winning, the bond compensates the project owner.

Performance bond

Issued after a contract is awarded, this guarantee ensures the contractor completes the project according to agreed terms. If the contractor fails to perform, the beneficiary can submit a demand in accordance with the guarantee terms to claim compensation.

Advance payment guarantee

When a project owner provides upfront payment to help a contractor begin work, they typically require a bank guarantee to secure this advance. This protects the owner by ensuring that the bank will honour a compliant demand for repayment of the advance in case of non-performance or misuse of funds.

Retention money guarantee

In staged (phased) projects, owners often retain 5–10% of each payment as security until completion. This guarantee enables contractors to receive the retained amounts earlier, improving their cash flow , while ensuring the beneficiary retains protection through the bank’s undertaking to honour a compliant demand.

Maintenance bond

Covers the contractor's obligation to repair defects during the warranty or maintenance period after project completion. This ensures the beneficiary has recourse through a demand made in accordance with the guarantee terms if issues arise post-completion

Counter guarantee

Enables international transactions by allowing QIB to issue a counter-guarantee in favour of a foreign bank, which in turn directly issues a a guarantee to the local beneficiary in their country. This structure simplifies cross-border guarantees and ensures compliance with local regulations and market practices.

Use these forms to apply for a Letter of Guarantee or request amendments during the validity period.

Documentary collection

Documentary collections are an alternative to Letter of credits and are governed by the ICC Uniform Rules for Collections . Your supplier presents the necessary documents, with instructions, to their bank (remitting bank), which forwards the documents to importer’s bank ((the collecting/presenting bank for handling in accordance with the remitting bank’s instructions.. The collecting bank/presenting bank releases the documents to the importer either against payment or acceptance as instructed by the remitting bank. The bank does not guarantee payment; it acts solely as an intermediary, ensuring compliance with the instructions received. Payment to the exporter (Supplier) is made only after the importer honours the payment or acceptance, with no hidden charges or unauthorized delays.

Types of documentary collection services:

  • Documents against payment (D/P): Import documents are released to the importer only upon payment of the amount due as instructed by the remitting bank.
  • Documents against acceptance (D/A): Import documents are released to the importer against acceptance of a draft (bill of exchange) or other written commitment to pay on the due date, as instructed by the remitting bank.

Benefits to your business: Eliminates the need for credit facilities if no bank finance is required for payment.

Clean bill for collection

A clean bill of collection comprises financial documents such as bills of exchange (drafts), promissory notes, cheques or similar instruments without accompanying commercial documents. Clean collections are commonly used to settle trade on open account or payments for services rendered.

Avalization of Bills

Avalization of bills (or aval) is a bank guarantee where a financial institution guarantees payment of a bill of exchange if the buyer defaults. This process secures payment for sellers while allowing buyers to defer payments for goods or services. It eliminates non-payment risk to the seller, providing assurance that the bank will honor the bill. Avalized bills are highly flexible tools often used in international trade to secure payments and improve cash flow.

Export bill for collection

When documents are received from customers and sent for collection under a specified schedule to the collecting/presenting bank, the transaction is termed an Export Bill for Collection (EBC). The presenting bank acts strictly on the instructions of the remitting bank, ensuring documents are handled according to the agreed terms, while payment or acceptance is obtained from the importer.

These forms allow you to authorise the collection or delivery of trade and corporate finance documents.

These forms are used to register or update your access to QIB’s trade and bill‑related services.

Shipping Guarantee / Delivery Order

When your goods arrive before the shipping documents are processed through the banking system, QIB can issue a shipping guarantee or release order on your behalf. This allows you to take possession of the goods before receiving the original transport document(s) helping to avoid delays and minimize disruption to your business operations.

Key benefits:

  • Shipping guarantees issued by QIB are widely accepted in the shipping industry.
  • A shipping guarantee can be issued on your request.

Click here to download the Tariffs Trade Finance.

Trade Finance and Services Forms

Trade Services Registration/Update Form

Authorisation Form for Collection/Delivery of Trade and Corporate Finance Documents

Application for Letter of Credit

Application for Amendment of Letter of Credit

Application for Letter of Guarantee

Application For Amendment of Letter of Guarantee

Purchase Order through Letter of Credit (MURABAHA)

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Frequently asked questions

A Letter of Guarantee is used in business contracts, trade transactions, and projects where one party needs assurance that obligations or payments will be fulfilled.

A payment or financial guarantee assures the supplier that the buyer will pay for delivered goods or services. If the buyer fails to pay, QIB makes the payment to the supplier.

A bid bond is issued during the tender stage of a project. It confirms that the supplier or contractor is serious about the bid and will accept the contract if awarded.

Advance payment bonds protect the beneficiary from misuse of advance funds and ensure the contractor starts and progresses with the work as planned.

It improves cash flow for contractors by releasing retained amounts early, without waiting until the full project or defect period ends.