A Usance or a Deferred Letter of Credit is also called as Term Letter of Credit.

The Letter of credit that is payable at a predetermined or future point following the conditions in the LC being fulfilled and the confirming documents being presented.

The Letter of Credit will set out the time to maturity and the actual payment date.

The Usance document sets are only Settled at the Maturity.  If several maturities have been posted to a document set, the system automatically proposes the next maturity for settlement.

The 'Final Settlement' for an Export Usance L/C Document Set will happen only on the Maturity time. In BETPAY transaction(Send, Accept and Settle Documents), the documents are accepted, the appropriate maturity is booked in and only a temporary settlement is generated.

A 'peak amount' is the remaining liability balance under a Letter of Credit that remains unutilized after payment of documents.
The checkbox 'Book out Peak Amount' can be activated when documents are taken up.
If set, the application checks the contract for other pending document sets and calculates the
liability amount which should be booked out under the Letter of Credit. The calculation of the
amount is displayed in the warnings for the user.

The Export L/C contract is closed when the amount settled actually matches the open amount. When a document set comprises several maturities, the contract is only closed when the last maturity is settled.

The 'Free of Payment' checkbox determines whether the documents are to be settled value-free, or not. Checking the checkbox means that the documents are settled immediately and without payment.

Loans to the issuing bank can be created by checking the 'Create Financing' checkbox on the 'Funds Settlement' panel. Financing details can be entered on the relevant panel.

Similarly if the bank wishes to do Advance for the usance documents at maturity, the 'Create Advance' checkbox on the Funds Settlement panel should also be checked. The Advance details can then be entered on the panel with the same name.

To Settle Usance Documents at Maturity under an Export L/C , BETSET transaction is used.  

Select it from the menu item[Export Products -> Export L/C -> Documents -> Settle Usance Docs at Mat.].

(Users can directly start this transaction by clicking the  (Launch transaction ) available in the Panel headline without having to select the relevant menu ) 

When you have made your changes, click on the ( )  Save function to save all the the data entered in the transaction to the database.