Banks serve as financial institutions that provide a range of services, including savings and lending, facilitating transactions, and managing investments. They play a central role in the economy by channeling funds between savers and borrowers while offering essential financial products and services to individuals, businesses, and governments.

Banks play a pivotal role in facilitating international trade through letters of credit (LCs). In this context, banks act as intermediaries, providing a guarantee of payment to the seller (exporter) upon presentation of specified documents confirming that the terms of the sale have been met. This mechanism mitigates risks for both the buyer (importer) and the seller, ensuring that funds are only released when the conditions of the transaction are fulfilled. Banks scrutinize documents meticulously to ensure compliance with the LC terms, thereby safeguarding the interests of all parties involved in the trade transaction.