| For the payment transferring method with a credit, the company X and the company Y issued a letter of attorney which allows local D bank, a negotiating nominated bank to make payment to the Y company and specified accounts receivable of Y company. Thereafter, the D bank received documents related to credit negotiation, and remitted to the Y company's account only the difference after paying trade fiance of the X company. Than Y company requested remittance in the total negotiated amount since the company transferred the whole payment. But the rejection continued so the company Y institute a law suit against the bank D for additional payment for the total transferred amount and the delay interest that followed.
Case study
1. Payment transferring in a credit transaction
According to the U.C.P., a beneficiary may assignment of proceeds to other parties with no objection to the transferable possibility of credit. And such transferring is not defining condition exercise right to the credit transaction. (The Article 49 of U.C.P 500) Accordingly, the assignment of proceeds with credit transaction is transferring only the right to payment request to the other party while a beneficiary reserving the rights and duty of the credit terms.
2. Assignment of credit and assignment of proceed
The difference between assignment of credit and assignment of proceed is, for assignment of credit, unlike the grantee who has to exercise both the credit terms and requesting payment, for the assignment of proceed, the person who has to exercise the credit terms is a beneficiary and the person request payment is the grantee.
Conclusion
When a negotiating bank is negotiating such a credit, the bank should remit all the payment to the grantee and it is reasonable to pay the difference of payment and the interest for delay.
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Trade Helper 
Claim . Unpaid Cases 
49-Assignment of proceeds
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