Legal Definitions - silent confirmation

Silent confirmation is a type of confirmation where a bank confirms a letter of creditbased on the request of the beneficiary of the credit rather than the issuing bank.

For example, if a company in the United States wants to buy goods from a company in China, they may use a letter of credit to ensure payment. The Chinese company may request a silent confirmation from their bank, which means that the bank will confirm the letter of credit without notifying the issuing bank in the United States.

This type of confirmation can be useful for the beneficiary because it provides an additional layer of security and reduces the risk of non-payment. However, it may also increase the cost of the transaction because the bank providing the silent confirmation will charge a fee.