MT700 — Issue of a Documentary Credit
The issuance of a letter of credit (LC, documentary credit). The SWIFT Cat 7 message that formalises an irrevocable payment undertaking between an issuing bank and an advising bank, under ICC UCP 600. Anchor of international trade for fifty years, and one of the few MTs untouched by ISO 20022 migration.
Purpose
MT700 communicates the issuance of a documentary credit: an irrevocable undertaking from the issuing bank (on behalf of the importer, its client) to pay the beneficiary (the exporter) on presentation of documents that comply with the credit terms, within a maximum amount, validity period and shipment performed under the agreed Incoterms.
It is the reference international-trade instrument when the exporter does not trust the importer (or vice versa): inserting two trusted banks substitutes a commercial risk with a bank risk. The issuing bank commits to pay if documents comply — typically: commercial invoice, bill of lading, certificate of origin, insurance policy, packing list.
Tag structure
Unlike Cat 5 (sequence-based), MT700 is a flat message: a sequence of numbered tags with no block hierarchy. Block 4 typically contains 40 to 60 tags covering the credit parameters. If the message exceeds about 2,000 characters, it splits into MT700 (main body) + MT701 (continuation).
Mandatory tags
| Tag | Name | Usage |
|---|---|---|
:27: | Sequence of Total | Message number / total (1/1 for a single one, 1/2 and 2/2 with MT701). |
:40A: | Form of Documentary Credit | IRREVOCABLE (default since UCP 600), IRREVOCABLE TRANSFERABLE. |
:20: | Documentary Credit Number | Unique credit reference on the issuing bank side (16 chars). |
:31C: | Date of Issue | Issue date (YYMMDD). |
:40E: | Applicable Rules | UCP LATEST VERSION (= UCP 600), or ISP LATEST VERSION for standbys. |
:31D: | Date and Place of Expiry | Expiry date + place (e.g. 260815BEIJING). |
:50: | Applicant | The principal (importer), name and address. |
:59: | Beneficiary | The beneficiary (exporter), name and address. |
:32B: | Currency Code, Amount | Maximum credit amount with ISO 4217 currency. |
:41A: or :41D: | Available with… by… | BIC of the nominated bank and payment mode (BY NEGOTIATION, BY ACCEPTANCE, BY DEFERRED PAYMENT, BY PAYMENT). |
:42C: | Drafts at… | Draft tenor (AT SIGHT, AT 30 DAYS…). |
:43P: | Partial Shipments | ALLOWED / NOT ALLOWED. |
:43T: | Transshipment | ALLOWED / NOT ALLOWED. |
:44E: | Port of Loading | Port of loading (UN/LOCODE). |
:44F: | Port of Discharge | Port of discharge (UN/LOCODE). |
:44C: | Latest Date of Shipment | Shipment deadline. |
:45A: | Description of Goods and/or Services | Goods description and Incoterm. |
:46A: | Documents Required | Exhaustive list of conforming documents expected. |
:47A: | Additional Conditions | Additional conditions (presentation period, etc.). |
:71B: | Charges | Bank charge allocation. |
:49: | Confirmation Instructions | WITHOUT / CONFIRM / MAY ADD — must the advising bank confirm? |
:78: | Instructions to Negotiating Bank | Reimbursement instructions. |
Real-world example
Documentary credit issued by BNP Paribas (issuing bank for importer ACME SARL) in favour of Guangzhou Textile Exports Co Ltd (beneficiary, Chinese exporter), for USD 150,000 CIF Lyon, shipment of 1,000 cartons of cotton T-shirts, advised via ICBC Beijing:
{1:F01BNPAFRPPAXXX0000000000}{2:I700ICBKCNBJXXXXN}{3:{108:LC20260515001}}{4:
:27:1/1
:40A:IRREVOCABLE
:20:LC20260515001
:23:NREF
:31C:260515
:40E:UCP LATEST VERSION
:31D:260815BEIJING
:50:ACME SARL
12 RUE DE LA SOIE
69001 LYON, FRANCE
:59:GUANGZHOU TEXTILE EXPORTS CO LTD
123 BAIYUN ROAD
510000 GUANGZHOU, CHINA
:32B:USD150000,00
:39A:10/10
:41A:ICBKCNBJXXXX
BY NEGOTIATION
:42C:AT SIGHT
:42A:ICBKCNBJXXXX
:43P:NOT ALLOWED
:43T:NOT ALLOWED
:44E:CNGZH
:44F:FRLYS
:44C:260815
:45A:1000 CARTONS COTTON T-SHIRTS
ART. REF ACME-2026-187
PRICE INCOTERMS 2020 CIF LYON
:46A:+ COMMERCIAL INVOICE IN 3 ORIGINALS
+ FULL SET CLEAN ON BOARD OCEAN BILL OF LADING
+ PACKING LIST IN 3 COPIES
+ CERTIFICATE OF ORIGIN ISSUED BY CCPIT CHINA
+ INSURANCE POLICY FOR 110 PCT INVOICE VALUE
:47A:DOCUMENTS MUST BE PRESENTED WITHIN 21 DAYS
AFTER SHIPMENT DATE AND WITHIN CREDIT VALIDITY
:71B:ALL BANKING CHARGES OUTSIDE FRANCE FOR ACCOUNT OF BENEFICIARY
:49:WITHOUT
:78:UPON RECEIPT OF COMPLYING DOCUMENTS
WE WILL REIMBURSE YOU AT SIGHT
-}:40A:IRREVOCABLE— irrevocable payment undertaking.:40E:UCP LATEST VERSION— subject to UCP 600.:31D:260815BEIJING— expires on 15 August 2026 at Beijing.:32B:USD150000,00— maximum amount.:41A:ICBKCNBJXXXX BY NEGOTIATION— available by negotiation at ICBC Beijing.:42C:AT SIGHT— payment at sight (no deferral).:44E:CNGZH/:44F:FRLYS— Guangzhou (CN) → Lyon (FR) ports, UN/LOCODEs.:46A:— five documents required (invoice, B/L, packing list, certificate of origin, insurance policy).:49:WITHOUT— no confirmation from advising bank (BNP accepts China country risk).
Common pitfalls
- Documentary discrepancy — a beneficiary presenting documents that do not strictly comply with
:46A:and:47A:risks refusal (MT734 / MT750). In practice, 60-80% of LCs present discrepancies on first presentation (ICC figure). - Implicit UCP version — since UCP 600 (2007), any credit not explicitly tied to a version is treated as such. But some Chinese and Indian banks still default to UCP 500. Always include
:40E:UCP LATEST VERSION. - Missing
:43P:— without specification, UCP 600 allows partial shipments by default. To forbid them, explicitly writeNOT ALLOWED. - Confusion between
:31D:place of expiry and place of discharge — the credit expires in a specific place (typically the beneficiary's country for Chinese or Indian operations), distinct from the:44F:port of discharge. - Missing Incoterms in
:45A:— any goods description must specify the Incoterm (Incoterms 2020). Without it, allocation of costs and risks is ambiguous.
ISO 20022 equivalent
The ISO 20022 Trade Services domain (prefix tsmt) produced a
family of messages (tsmt.001 to tsmt.052) intended to replace Cat 7, notably under
the SWIFT-launched Bank Payment Obligation (BPO) in 2013. Adoption
stayed marginal: BPO was retired commercially in 2020, and most banks still
use MT700 in 2026. No migration calendar.
Related messages
- MT701 — Issue continuation (if MT700 exceeds 2,000 chars).
- MT707 — Amendment to a Documentary Credit.
- MT710 — Advice of a Third Bank's Documentary Credit (re-advising).
- MT742 — Reimbursement Claim, request for reimbursement by the negotiating bank.
- MT750 — Advice of Discrepancy on non-conforming documents.
- MT754 — Advice of Payment / Acceptance / Negotiation.
- MT760 — Demand Guarantee / Standby Letter of Credit, standalone guarantee variant.