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Hedging Options

There are numerous promotion opportunities available for almost any project.

Documentary credit

Documentary credit - also called a letter of credit (L/C) - is a special form of payment in foreign trade. Bank Austria handles all variants of this instrument for its customers and supports them in selecting the optimal variant for their import and export transactions.

Export letters of credit

Bank Austria advises the exporter – with or without confirmation – of the letter of credit opened by the foreign bank at the order of the buyer, examines the presented documents and pays when the conditions of the letter of credit have been fulfilled.

Letter of credit transfers

When the exporter named as the beneficiary in a letter of credit must first purchase the goods before delivery can be made, the letter of credit can be transferred to the manufacturer in part or in whole under certain circumstances.

Discounting claims from letters of credit

Receivables from a letter of credit that are payable at a later date (for example 90 days after shipment) can be paid out to the exporter immediately if the necessary financial standing criteria are fulfilled.

Import letters of credit

Bank Austria opens the desired letter of credit on request by the importer. The letter of credit can be issued as a sight L/C, stipulate deferred payment, can be transferable or non-transferable, can require confirmation or can require non-binding advice and can be payable in Austria or in another country.

Back-to-back letters of credit

Are especially interesting for transit agents and are primarily used when a simple letter of credit transfer would not be possible or suitable.

Standby letters of credit (SLC)

This is a special form of letter of credit and is not used as a payment instrument, but only as a guarantee. SLCs are used when a standard bank guarantee cannot be issued due to foreign laws (for example in the USA).

Documentary collection

Documentary collections (or cash against documents, CAD) is a form of payment processing that is used in international trade, normally in connection with a goods transaction.

The collection conditions can stipulate

  • documents against payment, D/P and/or
  • documents against acceptance, D/A and/or
  • the fulfilment of other conditions (e.g. letter of undertaking)

These requirements should already be agreed when negotiating the purchase contract.


  • The seller and purchaser know each other as reliable partners.
  • Stable economic and political conditions in the purchaser’s country.
  • No suspicion of risks related to foreign exchange control or import restrictions.


The settlement procedure is governed by the Uniform Rules for Collections (URC) published by the International Chamber of Commerce in Paris. These are binding for all parties involved.


  • Have no obligation to examine the documents.
  • Are not liable to the seller for the payment of the payment claim by the purchaser.
  • Are in no way involved in the underlying transaction.

Distribution of risk

  • The seller must ship the goods and does not know if he will receive payment.
  • The purchaser must pay when he collects the collection documents, even if he has not yet received the goods, or if he has not yet been able to examine them to determine if they fulfil the terms of the contract.
  • The banks act as trustees.

Bills of exchange

Bills of exchange still play an important role in commercial payment transactions in Austria and abroad. Bank Austria is active for its customers in the following areas:

Bill discounting

The holder of a bill of exchange can have the bill discounted at his bank before the maturity date. When the issuer has a sufficient financial standing and when the corresponding formal requirements are fulfilled, the holder of the bill of exchange is credited with the bill amount promptly, less fees, costs and interest up to the date of expiration.

Bill collection

As a bill of collection is a debt that is performable at the debtor's business seat, the holder of the bill must present the bill to the debtor at the place of performance or at a place indicated on the bill in order to collect payment. Bank Austria takes care of this collection for customers who do not wish to or cannot do this.


Bank guarantees that focus on the protection of interests are not only a part of daily business for exporters and importers. As the fulfilment of nearly any contractual provision can be covered by a bank guarantee, this instrument is suitable both for cross-border transactions as well as for purely domestic business.

A bank guarantee can, for example, be used for the fulfilment of supply and service contracts, to cover guarantee claims, as liability deposits, for the repayment of advance payments and the payment of customs duties, for the redemption of a bill of exchange, as a bidder guarantee in connection with tenders or as a deposit for legal costs for court cases. In other words, a bank guarantee can be used whenever the bank should accept liability that your customer will fulfil the provisions of a contract.

Domestic guarantees

Bank Austria issues all types of guarantees in which a domestic business partner is named as beneficiary. This also includes guarantees for private matters (for example in connection with the purchase of a house or an apartment). This simply requires a properly completed application and sufficient funds on account.

Foreign guarantees

Bank Austria also issues guarantees in which a foreign partner is named as beneficiary (such as bid bonds and performance bonds). However, it is often necessary to involve a bank at the location of the foreign beneficiary. That means that the guarantee is opened by the local bank at the request of Bank Austria ("indirect guarantee"). Foreign laws apply in these cases, and only certain guarantee texts can be used.

Advice of guarantees

Guarantees from other banks that are received to the credit of a customer of Bank Austria are forwarded to these customers without a commitment from Bank Austria. We will be happy to assist you in implementing any guarantees when necessary.

Currency risk hedging

Read more about currency risk hedging.