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Thursday, September 1, 2011

How to configure Letter of Credit in SAP - Documentary payments Guarantee process

“Documentary payments” section under “Foreign Trade/Customs” enables you to create a master record for a "letter of credit" and assign it to a Sales order in SAP. This financial document is not only used for letters of credit. But it can also be used to represent documents against payment or documents against acceptance.

The Documentary Payments component is completely integrated in the Sales and Distribution (SD) Credit Management component to ensure that financial documents are harmonized with other forms of payment security such as payment cards. As an example of this integration, if the value of a sales order exceeds the value of its corresponding financial document, Credit Management will block the sales order.

If you want to learn about the credit management process in SAP, please click here.

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