Front-to-Back Letter of Credit (MT700/MT705) – Optimized Trade Finance for Seamless Global Transactions
Ensure Secure & Reliable Global Trade Payments | 100+ LC-Secured Projects | Global SWIFT Bank Network Connected
📌 Maximize Trade Efficiency with a Front-to-Back Letter of Credit (MT700/MT705)
⚠️ Have You Missed a Trade Due to Lack of Flexible Structuring?
Recently, a distributor lost a $2.8M deal due to poor LC structuring. NNRV designed a dual-layer Front-to-Back LC in 72 hours—saving the contract and boosting credibility with both supplier and buyer.
🧠 « With NNRV’s Front-to-Back LC, we financed 3 suppliers across 2 continents without a single dollar upfront. »
📌 What is a Front-to-Back Letter of Credit?
A Front-to-Back Letter of Credit (MT700/MT705) is a structured trade finance solution enabling intermediaries to leverage a buyer’s incoming LC to issue a secondary LC to their suppliers, all while maintaining total control over pricing, terms, and margins.
Unlike Back-to-Back LCs, this structure offers enhanced flexibility and synchronization, making it ideal for multi-supplier and large-scale international trade.
At NNRV Trade Partners, we structure and issue both layers of the LC via our global banking network to ensure seamless execution and total trade security.
✅ Perfect for Intermediary Trade: Helps brokers and distributors manage multi-party transactions efficiently.
✅ Leverages Buyer’s Creditworthiness: Uses the first LC as collateral for the second LC.
✅ Ensures Secure Supplier Payments: Guarantees payments to suppliers upon contract fulfillment.
✅ Ideal for Import-Export & Supply Chain Management: Facilitates bulk and phased shipments across international markets.
🧠 “NNRV helped us issue a €2.5M Front-to-Back LC covering phased deliveries in 3 countries.” — Khalid R., Industrial Equipment Broker
🔹 How Does a Front-to-Back LC Work?
1️⃣ Buyer Issues Master LC – The importer’s bank issues an LC in favor of the intermediary.
2️⃣ Intermediary Leverages Master LC ( Secondary LC ) – The trader or distributor uses the Master LC to secure financing.
3️⃣ Supplier Receives Secondary LC – A new LC is issued to the supplier, ensuring their payment upon delivery compliance.
4️⃣ Supplier Ships Goods to Buyer – The supplier ships the goods directly to the end-buyer and submits the required documents.
5️⃣ Bank Releases Funds Under Both LCs – The bank processes payments under the first and second LCs, ensuring smooth transactions.
6️⃣ Final Settlement for Intermediary – Any price margin between the two LCs is paid to the intermediary.
📄 Key Features of a Front-to-Back LC
🔹 Two Connected LCs: The second LC is linked to the first, ensuring supplier security.
🔹 Optimized Working Capital: Reduces cash flow pressure for intermediaries and traders.
🔹 Supports Bulk & Partial Shipments: Ideal for phased delivery and contract fulfillment.
🔹 Ensures Supplier & Buyer Protection: Bank-issued LCs guarantee payment and minimize risk.
🔹 Compliant with UCP 600 & International Standards: Follows globally accepted trade finance rules.
🔍 Who Benefits from Front-to-Back LCs?
✔ International Traders & Brokers – Manage trade transactions efficiently.
✔ Importers & Exporters – Secure payments and expand global operations.
✔ Wholesalers & Distributors – Optimize multi-party supply chains.
✔ Commodity & Raw Material Dealers – Facilitate large-scale industrial transactions.
📄 Required Documents for Front-to-Back LC Issuance
✔ Master LC Copy – A valid LC issued by the buyer’s bank.
✔ Proforma Invoice / Sales Contract – Specifies the transaction details and LC terms.
✔ Commercial Invoice – Proof of goods sold.
✔ Bill of Lading / Airway Bill – Confirms shipment status and Verifies logistics.
✔ Packing List – Provides an itemized list of goods shipped.
✔ Inspection Certificate (if required) – Ensures product quality compliance.
✔ Insurance Certificate – Required for CIF/CIP deals or valuable cargo.
🏦 Partner Banks & Financial Institutions for Front-to-Back LC (MT700/MT705)
We collaborate with top-tier banks and financial institutions to facilitate seamless Front-to-Back LCs across global markets.
🔹 Our Trusted Banking Partners Include:
| Bank Name | SWIFT Code | Advantages | Disadvantages | Issuance Fees | Issuance Time | Min. Transaction | Region |
|---|---|---|---|---|---|---|---|
| Bank of China | BKCHCNBJ | Trusted China trade corridor | Limited flexibility for SMEs | 0.5% – 7% | 2–6 days | $1M | Asia |
| Standard Chartered (Dubai) | SCBLAEAD | Leading in emerging market flows | Documentation-heavy | 0.5% – 7% | 2–6 days | $500K | Global |
| Exim Bank Tanzania | EXTNTZTZ | Suitable for Africa-based trades | Slower due diligence | 0.5% – 7% | 2–6 days | $250K | Africa |
| MauBank (Mauritius) | MPCBMUMU | Offshore benefits, fast issuance | Less known internationally | 0.5% – 6% | 2–5 days | $250K | Offshore |
| ABC Banking Corporation | ABCKMUMU | Great for intermediaries & traders | Limited reputation globally | 0.5% – 6% | 2–5 days | $250K | Offshore |
| Access Bank Kenya | ABNGKENA | Strong East Africa LC provider | Limited LC structuring experience | 0.5% – 7% | 2–5 days | $250K | Africa |
| Dashen Bank (Ethiopia) | DASHTEAA | Regional reliability in Horn of Africa | Longer issuance timeframes | 0.5% – 7% | 3–6 days | $250K | Africa |
📩Other partner banks available on request.
📢 All transactions comply with ICC’s UCP 600 international trade finance regulations.
🎯 Why Use a Front-to-Back LC?
| 🔒 Feature | ✅ Benefit |
|---|---|
| Layered LC Structure | Total control across buyer and supplier |
| Capital-Free Execution | No upfront capital required |
| Supports Complex Logistics | Phased or split delivery compatible |
| Margin Visibility & Retention | Capture profit transparently |
| Full UCP 600 & SWIFT Compliance | Internationally accepted and bank-backed |
🛠️ Our 5-Step LC Structuring Process
Submit Buyer LC & Trade Docs
We Design Secondary LC – Fully compliant & supplier-ready
Approval of Drafts by All Parties
Issuance of Both LCs (MT700/MT705)
Shipping, Verification & Payment Flow
💬 “Front-to-Back LC helped us fund $4M of equipment trade with no capital involved. NNRV is our partner of choice.” – Mohamed T., Mining Supplier – MENA
🔍 Front-to-Back LC vs Back-to-Back LC
| Feature | Back-to-Back LC | Front-to-Back LC |
|---|---|---|
| LC Count | Two separate LCs | Two LCs, layered structure |
| Price Control | Partial | Full |
| Document Flow | Separate & split | Seamless, integrated |
| Ideal For | Standard intermediation | Complex/multi-stage trades |
| Margin Visibility | Hidden | Transparent to intermediary |
💡 Why NNRV Trade Partners?
✔️ Dual LC Structuring Experts
✔️ Global SWIFT Network Access
✔️ UCP 600 & MT700/705 Mastery
✔️ Certified Across 40+ Jurisdictions
✔️ $250K to $100M+ LC Deals
✔️ End-to-End Compliance & Execution Support
💡 Why Choose NNRV Trade Partners for Your Front-to-Back LC?
🔹 Expert Trade Finance Advisory: Guidance on structuring complex transactions.
🔹 Global Banking Network: Secure multi-party deals with leading financial institutions.
🔹 Fast & Efficient Processing: Rapid LC issuance and approval.
🔹 Custom Financing Solutions: Tailored to meet your specific business needs.
🔹 End-to-End Transaction Support: From LC issuance to supplier payment facilitation.
💲 Issuance Fees & Important Notes
Fees depend on:
LC size and complexity
Number of linked beneficiaries
Bank compliance workload
Jurisdiction and delivery terms
🔹 Speak to a senior advisor for a tailored quote.
🧠 Real Testimonials
“We linked 3 LCs under one umbrella Front-to-Back LC with zero capital. Brilliant structuring.” A. Elhadji, Agro Exporter – Côte d’Ivoire
“NNRV delivered an impossible $5M deal under 6 days with full LC control.” R. Ben, Steel Trader – MENA
❓ Top 5 FAQs – Answered by Experts
1. Can the two LCs have different values or terms?
Yes. The intermediary retains full control over terms and margins.
2. Is this LC structure accepted globally?
Absolutely—when issued via MT700/705 and governed by UCP 600.
3. How fast can both LCs be issued?
Usually 3–6 business days after documentation and compliance review.
4. What’s the key difference with Back-to-Back LC?
Front-to-Back LC allows tighter integration and broader pricing control.
5. Can we use this for phased or bulk shipping?
Yes. It’s ideal for multi-stage or high-volume contracts.
🔗 Related Services
📖 Strategic Blog Posts
Front-to-Back LC: The Ultimate Tool for Capital-Free Scaling
How We Closed $11M in Multi-Tier LC Deals in 30 Days
Back-to-Back vs Front-to-Back: Choosing the Right Tool
🚀 Get Your Front-to-Back LC Today
Secure your global supply chain, protect your trade margins, and grow with confidence—without using your working capital.
📩 Book Your Free LC Pre-Diagnosis Today
☎️ Talk to an Expert | 🌍 Trusted in 40+ Countries | ✅ $250K to $100M+ Issuance.