Approval basis

If documents containing discrepancies are presented to the nominated bank under a letter of credit, the bank can forward the documents to the issuing bank for approval, with the beneficiary’s agreement. Because of the risk of loss in transit and delay’s resulting in interest loss, however, it is recommended that the beneficiary first try to correct the document; but, if that is not possible, the beneficiary asks the nominated bank to contact the issuing bank for authorization to accept the discrepancies.

Issuing banks charge a fee to accept discrepant documents if they will, in fact, accept them.