Ø The Bank, on behalf of the importer, makes payment to the foreign supplier after complying with terms and conditions of the LC.
Ø The Bank deals in documents and not goods.
Ø FDH Bank guarantees payment to the exporter on behalf of the Malawian importer.
Ø Payment effected only when all terms and conditions of the LC are met by the exporter.
Ø Payment is guaranteed and the supplier has the comfort to supply the goods within the agreed time frame.
Ø The Bank makes sure that all terms and conditions of the delivery are met by the supplier before making any payment, so the importer is assured of quality.
Ø Importer assured of delivery of goods by supplier as there is no risk of non-delivery after payment.