What's the difference between a "documentary credit" and a "demand guarantee"??



Answers:
A documentary credit is a document issued mostly by a financial institution which provides an irrevocable payment undertaking to a beneficiary against complying documents as stated in the credit.

Whereas A Demand Guarantee is an irrevocable undertaking issued by the guarantor, upon instructions or request of the principal to pay the beneficiary any sum that may be demanded by that beneficiary up to a maximum amount determined in the guarantee, upon presentation of a demand conforming with the terms of the guarantee.

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