Bank guarantee and Letter of Credit

How does one include Bank guarantee in SAP SD credit check.
What is the difference between bank guarantee and letter or credit?

Dear Ravi
To my knowledge, Bank Guarantee is used only in Imports whereas, L/C is used in both (exports and imports) scenarios.  In both the cases, bank stand guarantee for payment to seller.
thanks
G. Lakshmipathi

Similar Messages

  • Bank Guarantees and Letters of Credit

    Hi friends
    Can u help me as to the actual business flows of Bank Guarantees and Letter of Credit? In SAP, they are treated as noted items, but what is the exact procedure regards the liability creation.
    Any useful links wud be welcome.
    Thxs

    Dear Sanju MS,
    please kindly run the transaction OBXY. You should already have the following entries:
    D          G          Guaran.         Guarantee
    D          L          Letter          Letter of Credit
    Then You can use F-38, F-49 to post.
    I hope this helps.
    Mauri

  • Bank gurarantee and letter of credit

    Hi experts,
    how we can update the the bank gurarantee and letter of credit in SAP systems,
    Is i need any additional configuration ?
    regards,
    Sanju MS

    Dear Sanju MS,
    please kindly run the transaction OBXY. You should already have the following entries:
    D          G          Guaran.         Guarantee
    D          L          Letter          Letter of Credit
    Then You can use F-38, F-49 to post.
    I hope this helps.
    Mauri

  • System Alerts for Bank Guarantees and Letter of Credits

    Hi
    My requirement is to get system alerts when the the Letter of Credit(LOC) or Bank Guarantee (BG) is going to be expired.
    We are using Third Party software for  master data and other information related to  Letter of credit.
    In SAP ,I will  do special GL for LOC and assign to Reconciliation Account as  per standard.
    What is the best practice to get system allert, when ever the date is going to get expired.
    Many Thanks In advance
    Rama

    Hi,
    In case you want to send the last record only, then you can use following qurey
    SELECT TOP 1 * FROM DBO.OVPM T0 WHERE T0.CashSum >= 10000 AND DATEDIFF(DD, T0.CreateDate, GetDate()) = 0 ORDER BY T0.CreateDate DESC
    then in Alert u can set the frequency as 1 minute.
    Hope this helps...
    BR
    Samir Gandhi

  • Bank Guarantee and Cash Credit Limits in SAP

    Dear SAP Gurus,
    How  Bank Guarantee or Cash credit limits are maintained in SAP? How to do configuiration of it?
    Thanxs
    Regards,
    Divyesh.

    Hi,
    Credit limits are set for the Customers depending on the nature of business, their repayment pattern.
    This comes under Credit Management which you configure through Credit Control Area and set
    credit limits to monitor the customer credit worthiness and ageing analysis.  Regarding Bank Guarantee and letter of credits, they are normally for export customers which comes under Risk and Credit Management in Sales & Distribution Basic data.  You refer to SAP pdf searching through Google for SAP's SDBFCM pdf file which gives you total scenario regarding setting of credit limits and Bank Guarantee etc.
    Regards,
    Sadashivan

  • Bank a/c Bank Gurantees and Letter of credits, DD s ?

    Hi
    Pls explain how bank gurantees and Letter of credit customizin and procee of above field explain me with exampls any documents appreciated
    [email protected]
    Rams

    Hello Pablo,
    I had the same situation in Chile. I had to make the procedure manually because:
    - I could not determine with which Banks I was going to use for the LoC
    - I don't know the amount to be paid in each LoC
    - I don't know the payment terms for each LoC.
    - The LoC currency was not always the same
    If you solve these problems, may be a Z report which reads the Payment Method and a BAPI for GL document creation could help you, but its very complex.
    Kind Regards

  • Bank guarantee and performance bank guarantee

    hi frnds,
    how to create end user transactions for bank guarantee and performance bank guarantee
    i have configured spl gl indicators and gl accounts but i dont know how to create end user transactions  pls let me know
    bye
    suja

    hi phanindra,
    thank u for u r ans.. points were assigned
    let me know the complete process for bank guarantee -- all end user transactions
    with tcode and posting keys used.
    thank u
    ss

  • Configuration of Bills of Exchange and Letter of Credit

    < MODERATOR:  Message locked.  Please read the [Rules of Engagement|https://www.sdn.sap.com/irj/sdn/wiki?path=/display/home/rulesofEngagement] before posting next time.  If you have a specific question, please ask.  Otherwise search first. >
    Please can someone give me the steps for configuration of Bills Receivable, Payable and Letter of Credit.

    1) No restart is necessary when dataguard broker is used to upgrade the protection mode from maxperformance to maxavailability, you have to do this if you would change the mode manually outside the broker.
    2) ... Won't this be a problem since unless a switchover/ failover has been performed the standby database is not supposed to be mounted? ...
    I don't understand this. A standby database is always (at least,it may be even open,depending on the configuration and version,which you don't tell) to be mounted.
    You don't need to add 'standby database' to 'alter database mount', because Oracle knows is it a primary or a standby database. This clause is optional,more interesting for a human reader.
    Werner

  • Bank Guarantee

    Dear Experts,
    Please tell me how do we map functionality of bank guarantee and letter of credit in SAP 8.8
    Regards
    Agranshu

    Hi ,
    Check below threads:
    Letter of credit  management using SAP business one
    Re: Letter of  Credit management in SAP Business one
    Hope this willhelp you.
    Thanks,
    Neetu

  • Limit on LC and Bank Guarantee - Noted Items

    Dear SAP Gurus,
    We have a requirement from client as below for Letter of Credit and Bank Guarantee.
    Example: They have taken a combined limit for BG+LC today(10th June) they would like to track this separately.
    Similarly they can take a combined limit later say 15th June or 20th June……
    For each such iteration a separate tracking of limit maintenance and usage should be available.
    How to achieve this?   Please guide.
    Thanks in advance.
    with best regards
    Ramesh

    Hello Ramesh,
    You can track Bank gurantees and Letter of credit's ,if you implement risk management ,which is under Sales and ditribution module.
    Transaction code :- VX11N / 12N / 13N .

  • Bank Gurantees & Letter of Credit

    Pls explain how bank gurantees and Letter of credit customizin and procee of above field explain me with exampls any documents appreciated
    [email protected]
    Edited by: Madhava Venkat on Jul 2, 2008 8:56 AM

    Hi
    Bank gtee, Performance gtee and Letter of Credit - all three are statistical postings just like contingent assets or liabilities. It should be excluded from the Financial statement version.
    These needs to be entered in the below transaction codes:
    F-55 - Vendor statistical posting entry
    F-56 - Vendor statistical posting entry reversal
    F-38 - Customer statistical posting entry
    F-19 - Customer statistical posting entry reversal.
    1) For entering this, you need to create a special G/L indicator like bank gtee recd or given, letter of credit recd or given and perf gtee recd or given for customer and vendor in FBKP transaction code.
    For creating the special G/L indicator, you need to create recon accounts for these entries in FS00.
    2) You need to create an offsetting account and provide open item management ticked and post automatically ticked in FS00 tcode.
    Enter the entry in the above transaction codes.
    In case of reversal entries, in the G/L account column, enter the alternative recon account which you provided in the special G/L indicator, enter customer/vendor number and document number and click edit line items. Set the line item to active, but selecting "+" from the F4 option and click post. This will reverse the document you have made.
    Hope it will help you lot
    Regards
    Aman
    Assign points if useful

  • Letter of Credit Process in SAP

    Hi Guru's
    Can any one send me or explain me  the letter of credit process in SAP or sales cycle?
    please send step by step configuration or documentation on the above process.
    my mail id is [email protected]
    Suitable points will be rewarded.
    thanking you in advance for your kind help.
    Thanks n Regards
    Toshniwal

    Hi,
    Please find the Letter of credit details
    The configuration is as follows - OVFD, Define and assign payment guarantee, OBYN,OBYH, and OBYK. It is properly working.
    I made all the required transaction VX11N, VXA2, F-36, F-34, F-20
    Letter of Credit: A letter issued by a bank to obtain payment for goods. When a letter of credit is confirmed, the advising bank guarantees payment only if all stipulations in the letter of credit are conformed to exactly.
    1.The importer first request a quote for merchandise. This may or may not include transportation and insurance costs.
    2.The importer prepares a purchase order based on the offer received from the exporter.
    3.The exporter creates a proforma invoice and sends it to importer.
    4.The importer opens a letter of credit with the opening bank in the country of import.
    5.The opening bank sends the letter of credit to the advising bank in the exporters country.
    6.The advising bank advises the exporter that a letter of credit has been opened in his favor.
    7.The exporter ships the merchandise in accordance with the terms stipulated in the LOC.
    8.The exporter gives the documents proving that the shipment was made in conformance with the LOC to the advising bank.
    9.The advising bank pays the exporter based on the documents received.
    10.The advising bank transfers the documents to the opening bank and receives payment.
    11.The opening bank gives the document to the importer.
    12.The importer calculates the duty rates, file the declaration with customs and pays the customs duties within the time frame required by law.
    Hope this will be useful
    Reward points if helpful to you.
    Bye
    Anil

  • Hi, Noted item-Bank Guarantees

    Hi Gurus,
    I configured the noted item for bank guarantees and i am making postings also, and my doubt whether this bank Guarantee reconciliation a/c's, we are mapping in the balances or not. what's the procedure in case of preparation of balance sheet for noted items.  Please let me know,  i will assign points.
    sd/-
    Rajesh

    Hi Rajesh,
    As you understood correctly there won't be any financial impact because of these Noted items..
    All these are single line item documents....
    Even though we assign the Recon a/c to these Spl GL a/c, there won't be any posting to these a/c and even if you assign them to the FSV, system will not show any balance on your Balance sheet or Trial Balance.
    These are only useful for reporting...in FBL1N and FBL5N you can generate reports by selecting the Noted items in the selection given in the down.....
    I hope it will clarify your doubt...otherwise please revert back
    Thanks & Regards
    Ravi C

  • Import Leter of credit

    Hello peers,
    can any one tell me the configuration steps for LC process in SAP. pls am struck in middle.
    Thanks
    Murali

    Hi,
    Import Process Involving a Letter of Credit
    You (the importer) first request a quote for the merchandise. This may or may not include transportation and insurance costs.
    You prepare a purchase order based on the offer received from the exporter.
    The exporter creates a pro forma invoice and sends it to you.
    You open a letter of credit with the opening bank in the country of import.
    This involves advising the bank of the documents required from the exporter. As an importer, you not only need the documents required by customs, but also the documents that are required by any other agency regulating your commodity. These may include
    Bills of lading
    Commercial invoice
    Export packing list
    Shipper's Export Declaration (SED) (Required in the USA for goods valued at $2501 or more)
    Shipper's Letter of Instructions (SLI) (applies only to the USA)
    Single Administrative Document (SAD) (applies only to the EU)
    Certificate of Origin
    Insurance certificates
    Licenses (when necessary)
    Using the SAP FT application, you can  create the letter of credit yourself before contacting the opening bank. Other than insurance certificates, you can also create the documents listed above using FT.
    The opening bank sends the letter of credit to the advising bank in the exporter's country.
    The advising bank advises the exporter that a letter of credit has been opened in his favor.
    The exporter ships the merchandise in accordance with the terms stipulated in the letter of credit.
    The exporter gives the documents proving that the shipment was made in conformance with the letter of credit to the advising bank.
    The advising bank pays the exporter based on the documents received.
    The advising bank transfers the documents to the opening bank and receives payment.
    The opening bank gives the documents to you (the importer).
    You calculate the duty rates, file the declaration with customs and pay the customs duties within the time frame required by law.
    Hope this helps you.
    Rgds
    Manish

  • Letter of Credit SPL Screening in GTS

    Hi,
    I want to perform SPL screening of banks on the letter of credit documents created in ECC.
    What document type in ECC to corresponding doc type in GTS
    How can I achieve that? Can anybody throw some light on this?
    Thanks,

    Please refer to the topic 'Integrating SPL Screening with Financial Accounting' in the customizing documents for details.

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