Bank comfort letter (BCL): what it is and how to verify it
By the Vanguard Verify desk · Published 2026-10-24 · Updated 2026-11-04
Short answer: a bank comfort letter (BCL) is a letter from a bank saying, in general terms, that its customer is known to it and has the means to do a deal. It is usually worded to avoid any binding commitment, so it is not a guarantee, not an LC and not proof that you will be paid. Verify it by contacting the bank directly through official channels, and rely on an issued LC or guarantee for actual security.
What a BCL can and cannot show
| A genuine BCL may show | A BCL does not show |
|---|---|
| The company is a customer of the bank | That funds are blocked or reserved for your deal |
| The relationship is in good standing | That the bank will pay you |
| The customer could, in principle, support a deal of a stated size | That an LC or SBLC will be issued |
Legal commentary on letters of comfort, such as from UK law firm Macfarlanes, notes that they are normally designed to create moral rather than legal obligations, and whether a court treats one as binding depends on its wording and context. In commodity trade, treat a BCL as background information only.
Step-by-step check
- Check the issuing bank exists and the BIC on the letter is real, using Swift’s free BIC search. The name, city and country must match.
- Find the bank’s contact details yourself from its official website. Ignore phone numbers, emails and “officer” names printed on the letter.
- Ask the bank to confirm authenticity. Many banks will only confirm to their customer or via bank-to-bank channels, so ask your own bank to make the enquiry if needed.
- Match the customer. The company named on the BCL must be the company signing your contract. Check it in the company registry and GLEIF LEI database.
- Read the wording. Phrases like “ready, willing and able” (RWA) or “without any liability on our part” are common; none commit the bank to pay you.
- Move to a real instrument. Ask for a documentary LC (MT700) or a guarantee issued by the bank, which you can authenticate through your own bank.
Red flags
- A BCL sent before the buyer has even been identified, or from a bank in a different country from the buyer, with no explanation.
- Free-mail addresses (gmail, outlook) or domains that do not belong to the bank.
- Claims that funds are “blocked” or “earmarked” for you via the letter.
- Requests that you pay a fee to receive or “activate” the BCL.
- Reference to non-existent ICC rules such as “UCP 700”.
- A seller who wants your BCL before showing any proof of product.
See also POF vs POP and how a DLC (MT700) works.
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FAQ
Is a bank comfort letter a guarantee?
No. A BCL is usually worded to avoid a binding commitment. For payment security, use a documentary LC or bank guarantee.
Who issues a BCL?
The buyer's bank, at the buyer's request. The seller provides proof of product, not a BCL.
How do I confirm a BCL is real?
Contact the issuing bank through details on its official website, or ask your own bank to verify via bank-to-bank channels. Never rely on contacts printed on the letter.
What is the bank comfort letter meaning in trade?
A letter from the buyer's bank saying the buyer is a customer in good standing and, often, can support a deal of a stated size. It gives comfort, not a promise to pay.
Is a bank comfort letter the same as proof of funds?
No. Both come from the buyer's side (the buyer gives POF, the seller gives POP), but a BCL is softer than a bank-verified proof of funds, and neither blocks or guarantees money.
Can a BCL be sent by SWIFT MT799?
Some banks send comfort wording as an MT799 free-format message. It still creates no payment obligation; confirm it with your own bank.
Vanguard Verify is run by Vanguard Trade Capital Goods Wholesalers DWC-LLC, Dubai South, Licence 14282. This answer is general information, not legal or financial advice.