International letters of credit (LCs) remain one of the most secure and widely used instruments in global trade finance. This article explores the current status of commercial banks in facilitating international LCs, focusing on their role, operational dynamics, compliance requirements, and the challenges they face in today’s complex and regulated global financial environment. The paper also examines the impact of digitalization and international banking standards on the effectiveness of LC operations. Through analytical insights and global case studies, the article concludes with key recommendations to improve LC service efficiency and mitigate risks for commercial banks.

Letter of Credit, Trade Finance, Commercial Banks, SWIFT, UCP 600, Risk Management, Digitalization, International Banking

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