Q#1: What are major and minor discrepancies of the document (letter of credit)?

Ans The Common discrepancies of the letter of credit is as following

Does not comply with the terms and conditions under which it was established. The description of the goods in LC differs from invoice. Letter of credit has expired. Late presentation of documents. Late shipment of goods. Inconsistent spelling of parties names in documents. Merchandise description not strictly as per L/C term. Partial shipment or transhipment effected despite L/C terms. Foreign language documents must be exactly as per L/C. Documents are not consistent with one another. Ocean Bill of Lading issued by forwarding agent unacceptable. Bills of Lading not clean. Insurance does not cover risks stipulated in L/C. Insurance issued after shipment date. Bills of Lading and Drafts not properly endorsed. Drafts not completed properly.

The Major Discrepancies of the Letter of credit is as following

Late shipment of the goods. Late presentation. L/C expired period. Draft in excess of amount permitted in L/C. Bills of Lading incorrectly issued. Insurance policy bears a date later than the date of shipment shown on Bill of Lading.

Q#2: What are the advantages to the economy because of letter of credit? Ans The letter of credit contribute a lot towards the economy of the country and country get
some advantages which are as following Increase Finance international trade which played major role in the development of economy. The exports of the company increases. The letter of credit creates the opportunity of the employment. Increase the production and productivity of the organizations.

Develop Exporter and Importer Strong relation. Banks of country more able to generate high profit through foreign currency. Enhance the skills. The Assurance and guarantee image became strong. Increase Finance international trade which played major role in the development of economy. Reduce the risk of the non-performance of the exporter so in this way more transactions take place and more development in the economy. GDP increase thought high no of L/C.

Reference
http://fea.files.cms-plus.com/ExportEssentials/9discrepancies.pdf http://www.businessdictionary.com/definition/discrepancy-letter-of-credit-L-C.html http://letterofcreditforum.com/content/lc-discrepancies http://letterofcreditforum.com/content/letter-credit-minor-discrepancies http://www.bizresearchpapers.com/Bergami.pdf