Description MT760 - TRADE TO PPRICE
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Description MT760
MT760
Description MT760
Banking at a Glance
Bank Swift Messages used by Real Buyers and Sellers
SWIFT MT760 SBLC/BG
In order to transfer messages, SWIFT developed nine different types of messages. The MT760 is one of those messaging options. Usually, it is a message sent at the request of the account holder, from one bank to another. The account holder wants to show the other bank there are funds available to cover a particular transaction. In order to make this message happen, the account holder agrees that their bank will hold the same amount of funds as security for the transaction. This security feature makes the MT760 a cash-backed financial instrument.
Some banks in the United States do not willingly issue MT760 messages. Before initiating such a transaction, you need to verify that your bank will handle those transactions. There are fees associated with these transactions. It can run as high as 0.05% of the transaction amount. This transaction is common for amounts of $1,000,000 or above.
A common use for the MT760 transaction is to back up large orders of product. The guarantee of funds gives the supplier confidence of payment for the order.
Another common use of the MT760 is to back up large projects of many different sorts. To get that, you need to have a good project to begin with. Then you need to have a bank willing to issue the MT760. You will have to cover all the costs of the fees associated with it. You also need to know how you will handle closing the transaction at the end of the project.
Now that you do know the definitions and applications, let’s cover the key points no one ever brings up about the MT 760: the FEES, and the RISKS…
First and foremost, the fees for blocking a large amount of funds via MT 760 can be more than you would expect. In most cases, your bank will charge 1-2% of the value being blocked for this service. For example, on a 100M bank instrument this can be 1-2M that the owner must come out of their pocket with, unless they have a special relationship with their bank. You may say to yourself, “Wow, that is a lot to spend on fees for something I’m not sure will work”! Well, even more importantly, let’s take a look at the risks if you did move forward.
If you complete the MT 760 and pay the fees, you should observe everything very closely from that point on. Once the MT 760 has hit the account of the trader, the line of credit should become available within 72 hours. At that time, the trader should be able to make their first bank instrument purchase, and give you a DEFINITE TIMELINE for your first profit disbursement. You may say, “Why do I need to watch this process so closely?” Well, here is the part that most brokers don’t tell their clients…
When blocked in someone’s favor, the MT 760 collateralizes assets in the form of a swift guarantee, and by doing so, allows the beneficiary to draw credit against it. This means, if the loan to the “trader” was defaulted on, the bank would seize the collateral and you would be out of your money! Though this scenario is possible, I would consider it rare for two reasons… In today’s world, no bank will loan Millions of dollars to someone they haven’t vetted, no matter what collateral is on hand. Second, the MT 760 is quite rare, and this usually draws attention to the beneficiary of the swift.
In summary, the MT 760 can be safe, or it can blow up in your face. As always, the key is having a real trader and most importantly, getting your payments as scheduled. If the trader makes a statement about yields and a time line, they must ALWAYS keep in line with their promises. Over the THOUSANDS of transactions we have been involved in, the only ones that have closed have been smooth from the start, with NO hiccups.
Remember, both RISK and FEES are a part of blocking funds via MT 760!!!! In addition, by understanding the MT 760 and MT 799, you can clear out the TIME WASTING brokers from your network, and work MORE EFFICIENTLY towards your goals.
Let’s face it, very few people know as much as you do after reading this article. Use it to your advantage to qualify the private placement investments you come across, and it will make life a lot easier. Ask yourself, if someone can’t explain the MT 760 and MT 799 in thorough detail, do you think they have ever closed a deal? Then ask yourself, do I want to risk Millions with someone that has NEVER been successful? It’s not hard to see, education is the key!
