Letters of Credit or LC’s are used in International transactions in order to facilitate the trade of goods between the  buyer and seller (typically  importer and exporter). 

The LC will be issued by a bank  on behalf of the buyer / importer to the seller / exporter with the bank controlling documents   and guaranteeing  the payments  in exchange of goods providing security for all parities.  

LC’S can  be either  at ‘Sight’, meaning payable immediately on exchange of documents and goods   OR  ‘Usance’ (otherwise known as ‘Time LC”s’), which  are to be paid at a fixed future and agreed date after the exchange of documents and goods (for example 90 days or 180 days)