Irrevocable letter of credit

One of the forms of letter of credit that cannot be cancelled or changed without the consent of all parties involved. However, both exporter and importer may prefer an irrevocable letter of credit. With this type of letter of credit, the importer’s bank is obligated to pay and is willing to accept any drafts (bill of exchange) at sight, meaning these drafts will be paid as soon as the correct documents are presented to the bank.