alleryStart learning →What does a confirming bank add to a letter of credit?
AA tax clearance paper
BA customs clearance
CA cargo insurance cover
DIts own payment undertaking
Answer & Solution
Correct answer: D. Its own payment undertaking
A confirming bank adds its own undertaking to pay a complying presentation, which gives the seller extra security at extra cost.
Keep practising International Working Capital Management
Browse all International Working Capital Management questions for CA Final, or explore more Strategicfinancialmanagement topics.
Related questions
In a multilateral net settlement system, how does each participant settle?What is the primary objective of netting in financial markets?When does close-out netting normally operate?What does positive pay reduce?What does a lockbox service help a company do?Which bank service moves surplus balances into a money market fund overnight?Which technique converts debtors to cash in short-term financing?Which firm policy directly affects the cash conversion cycle by governing sales on credit?