· L/C (Letter of Credit)

A letter of credit (L/C) is a written document issued by a bank to the beneficiary with a certain amount and promised payment within a certain period based on the request and instructions of the applicant for issuance; or The bank is willing to purchase the beneficiary's bill of guarantee on behalf of the applicant under the conditions of the prescribed amount, date and documents.

In international trade activities, buyers and sellers may not trust each other. The buyer is worried that the seller will not deliver the goods as required by the contract after the advance payment; the seller is also worried that the buyer will not pay after the goods are delivered or the shipping documents are submitted. Therefore, two banks are required to act as guarantors for both buyers and sellers, to collect payment and present documents on their behalf, and to replace commercial credit with bank credit. The tool used by the bank in this activity is the letter of credit.

· T/T (Telegraphic Transfer)

T/T (Telegraphic Transfer) wire transfer refers to the sending bank, upon the request of the remitter, to send a telegram, telex or SWIFT to a branch or correspondent bank in another country (i.e. the inbound bank)

A remittance method that instructs the payment of a certain amount to the beneficiary.

T/T is a commonly used method of trade settlement in international trade, which has certain risks.