Up to 90% of Bill Value
LC-Backed & Open Bills
Turn Your Unpaid Bills Into Cash Today
Independent LC & Bill Discounting advisory from Inwealfoney. We help you convert sales bills, invoices and Letters of Credit into immediate working capital — at the sharpest rate a bank or NBFC will offer.
Discount rates from
9.00% p.a.*
Advance up to
90%
What is LC / Bill Discounting
Convert a future payment into cash, today
Bill Discounting (also called Invoice Discounting) is a working-capital facility where a bank or NBFC pays you the value of a genuine sales bill or invoice — minus a discount — well before your buyer's actual payment date. When the underlying trade is backed by a Letter of Credit, the facility is called LC Discounting: the bank relies on the LC-issuing bank's undertaking rather than your buyer's creditworthiness, which usually makes it faster to sanction and cheaper to price.
LC-Backed
Inland Bill Discounting Under LC
The bill is drawn strictly per the terms of a domestic Letter of Credit. Once the LC-issuing bank accepts the documents, your bank discounts the bill against that acceptance — the strongest and cheapest form of bill discounting.
Open / DA-DP
Inland Bill Discounting Without LC
Discounting against Documents-against-Acceptance (DA) or Documents-against-Payment (DP) bills, sanctioned within your working-capital limit and priced on the buyer's and your own credit profile.
Export
Export Bill Discounting Under LC
For exporters shipping against a foreign LC — post-shipment finance is disbursed on submission of shipping documents, with the bank recovering the amount from the LC-issuing bank on due date.
Multi-lender comparison
Your bill/LC profile is matched against several banks/NBFCs for the sharpest discount rate.
Faster than a term loan
Sanction typically rides on the underlying trade documents, not fresh collateral or lengthy appraisal.
Off-balance-sheet funding
It's a sale of a receivable, not a fresh borrowing — so it doesn't add to your term-loan liabilities.
Documentation support
We help assemble bills, LC copies and transport documents in the exact format your lender wants.
Eligibility
Do you qualify? Here's what lenders actually check
Criteria differ depending on whether your bill is backed by a Letter of Credit or is an open/DA-DP bill — these are the core checks in 2026.
- ✓A valid, unexpired Letter of CreditIssued by a bank acceptable to the discounting bank, covering the specific bill being discounted.
- ✓Bill strictly conforms to LC termsAny discrepancy between the bill/invoice and LC conditions can delay or block acceptance.
- ✓Business vintage: 1–2 yearsSince risk sits largely with the LC-issuing bank, seller vintage requirements are usually lighter than for open bills.
- ✓GST registration & regular filingConfirms the underlying trade transaction is genuine.
- ✓CIBIL/CMR of promoters: 700+Still reviewed even though the LC-issuing bank's credit stands behind the payment.
- ✓Business vintage: 2–3 yearsLonger track record expected since there's no bank-backed LC undertaking.
- ✓Minimum annual turnover: ~₹40 lakh+Varies by lender; higher turnover supports a larger discounting limit.
- ✓Buyer's creditworthiness mattersThe lender assesses the drawee/buyer's repayment track record, not just yours.
- ✓Genuine bill of exchange / invoiceWith clearly defined payment terms, due date, and proof of goods dispatched or services rendered.
- ✓CIBIL/CMR of promoters: 700+Along with an existing working-capital or current-account relationship with the lender.
Bill Discounting at a Glance
Advance against bill value75% – 90%
Discount rate9% – 18% p.a.
Usance period30 – 180 days
Facility typeRevolving / bill-wise
Processing fee0.25% – 1% of bill value
You're charged only for the number of days between disbursal and the bill's actual due date — the moment your buyer pays, the discounting cycle closes.
Documentation
What you'll need to keep ready
Having these scanned and organised before you apply typically shaves days off sanction and disbursal time.
KYC & Business Documents
- PAN & Aadhaar of all promoters/partners
- Business PAN & GST certificate
- Certificate of incorporation / partnership deed / LLP agreement
- Udyam/MSME registration, if applicable
Trade Documents
- Original bill of exchange / commercial invoice
- Purchase order / sales contract with the buyer
- Letter of Credit copy (for LC-backed discounting)
- LR / GR / e-way bill or bill of lading as dispatch proof
Financial Documents
- Last 2–3 years' ITR with computation
- CA-certified or audited P&L and balance sheet
- Last 12 months' GST returns (GSTR-3B/1)
- Last 12 months' current account bank statement
Buyer / Acceptance Proof
- Buyer's acceptance on the bill (DA bills)
- Goods-receipt note or service-completion confirmation from buyer
- No-objection / confirmation from buyer, where the lender requires it
Existing Credit Facilities
- Sanction letters of any running loans, OD/CC, or discounting limits
- Latest CIBIL/CIR (company & promoters)
- NOC from existing lender, if switching or adding a facility
Business Continuity Proof
- Shop Act licence / trade licence
- Rent agreement or ownership proof of business premises
- Latest utility bill in business name
Note: Exact requirements vary by lender, bill value, and whether the transaction is LC-backed, open, or export. Share your invoice/LC details with us and we'll send a checklist customised to the bank/NBFC we're targeting for you.
Process
How LC / bill discounting actually works
The mechanics differ slightly for LC-backed and open bills, but the core flow stays the same.
Domestic / Inland Bill Discounting
01
Goods/services delivered
You supply goods or services to the buyer and raise a bill with a defined due date.
02
Bill submitted to bank
You submit the bill — along with the LC, if applicable — to your discounting bank/NBFC.
03
Verification & acceptance
The bank checks the bill against LC terms or the buyer's acceptance, and sanctions the discount.
04
Funds disbursed
Up to ~90% of the bill value is credited to your account immediately, net of the discount charge.
05
Buyer pays on due date
On maturity, the buyer (or LC-issuing bank) pays the full bill value directly to your bank, closing the transaction.
Export Bill Discounting Under LC
01
LC received
Your overseas buyer's bank issues an LC in your favour, routed via your bank as advising bank.
02
Goods shipped
You ship the goods and prepare shipping documents strictly matching the LC's terms.
03
Documents negotiated
Documents are submitted to your bank, which checks them for compliance with the LC.
04
Post-shipment finance
Your bank advances the discounted value against the LC-issuing bank's undertaking.
05
Reimbursement received
Your bank collects the full amount from the LC-issuing bank on the due date and squares off the advance.
Discount Estimator
Estimate what discounting your bill will cost
Discounting has no EMI — the cost depends on the bill value, the discount rate, and the number of days left until the bill's due date. Drag the sliders to estimate.
₹10,00,000
12.00%
90 days
₹0
Net Proceeds Today
You receive
Discount charge
Discount Charge
₹0
Net Proceeds
₹0
Effective Cost (p.a.)
0.00%
Cash Freed Up Early
0 days
*Indicative estimate only, assumes simple discounting on the full bill value for the entered usance period. Actual charges include processing fee, applicable GST on charges, and lender-specific calculation methods.
FAQs
Common LC & bill discounting questions
In LC discounting, the bank relies on the Letter of Credit issued by the buyer's bank as the payment undertaking — so pricing depends mainly on the issuing bank's credit standing. In regular (open) bill discounting, there's no LC, so the lender evaluates your buyer's own creditworthiness and repayment history directly, which typically means a slightly higher rate.
Most lenders advance 75–90% of the bill value upfront, holding back a margin as a buffer. Some lenders offer up to 95% for strong, LC-backed or highly rated buyers. The balance (minus discount charges) is settled once the buyer pays on the due date.
Technically it's a sale of your receivable — you're transferring the right to collect payment to the bank in exchange for immediate cash, minus a discount. This is why it's often preferred over a fresh loan: it improves cash flow without adding to your term-loan liabilities.
For LC-backed bills, the LC-issuing bank is obligated to pay, so the risk of buyer default is largely covered. For open/DA-DP bills discounted "with recourse" — the standard structure — the bank can recover the amount from you if the buyer defaults, so you continue to carry the underlying credit risk.
Usually not. The bill itself — backed by an LC or the buyer's acceptance — serves as the primary security. Some lenders may still ask for a personal guarantee from promoters or set it up as a sub-limit within your existing working-capital facility.
Both. Several NBFCs offer bill discounting alongside banks, often with faster turnaround and slightly more flexible eligibility — though usually at a marginally higher rate than a bank's LC-backed facility.
Expect a processing fee (roughly 0.25–1% of the bill value), applicable GST on charges, and possible bill-collection or LC-negotiation charges from the issuing/collecting bank. Always ask for the full charge schedule before submitting your bill.
Let's turn your next bill into working capital
Share your bill or LC details and we'll compare lenders on your behalf — no cost, no obligation, and no running between branches.
Inwealfoney · Loan advisory services. Discount rates, advance percentage, and eligibility are indicative and subject to lender policy at the time of application.