MT700, MT707 and the current state of a letter of credit

By Saurabh Goyal, Founder & CEO of Phlo Systems. Published 24 July 2026.

When a trading team talks about "the LC", they usually mean a PDF in a folder: the credit as it was issued. But by the time documents are presented, most credits of any size have been amended, sometimes several times: the shipment date extended, the amount increased, a document requirement reworded, a port changed. The instrument your presentation will actually be examined against is not the PDF in the folder. It is the original credit plus every amendment in force, resolved into a single current state. A surprising share of avoidable discrepancies comes down to checking against the wrong version.

The 30-second answer: the issuing bank communicates a credit as an MT700 SWIFT message and each amendment as an MT707. An amendment binds the issuing bank from the moment it is issued, but binds the beneficiary only if the beneficiary accepts it, and acceptance can happen silently, by presenting documents that conform to it. Compliance is therefore defined against a moving target, and the first job of any serious document check is to resolve the sequence into one authoritative set of effective terms.

The instrument and its fields

The MT700 carries the credit's operative content in numbered fields, and the vocabulary of document checking is the vocabulary of those fields: 20 (credit number), 31D (expiry date and place), 32B (currency and amount), 39A (tolerance), 43P and 43T (partial shipment and transhipment), 44C (latest shipment date), 44E and 44F (ports of loading and discharge), 45A (description of goods), 46A (documents required), 47A (additional conditions), 48 (period for presentation). A bank PDF advice is a rendering of the same content, and credits also arrive as portal downloads or even as text pasted from the applicant's email. The form varies; the field structure is the same, and every downstream check hangs off it.

The MT707 is the amendment message: it references the credit and states what changes. It does not restate the credit. Reconstructing the current state is a fold: start from the MT700, apply each accepted amendment in sequence, and let later changes supersede earlier ones where they touch the same field.

The rules that make this subtle

UCP 600 article 10 governs amendments, and three of its consequences shape daily practice.

First, a credit cannot be amended unilaterally: amendment requires the agreement of the issuing bank, the confirming bank if any, and the beneficiary. The applicant asking for a change does not make it so.

Second, the beneficiary's acceptance can be silent. If the beneficiary presents documents that comply with the amendment, that presentation is acceptance. This is a genuinely dangerous convenience: a beneficiary can accept an amendment by accident, through a document assembler who never saw the amendment queue.

Third, partial acceptance of an amendment is not allowed. An MT707 that extends the shipment date and reduces the amount is a package; complying with one half and not the other is a rejection of the whole, and documents drafted to the half-accepted state conform to nothing.

Add the operational realities: amendments can be pending (issued but not yet accepted or rejected), rejected amendments must be excluded from the fold, and two amendments can conflict, in which case sequence decides. None of this is exotic. It is the ordinary life of a credit on a trade of any complexity.

What goes wrong without a single current state

The failure pattern is always some version of the same story. The operations team checks documents against the original credit, and misses that an amendment tightened the presentation period. Or checks against the latest amendment alone, and misses that an earlier one changed the goods description. Or treats a pending amendment as accepted because the applicant said it was agreed. Each error produces documents that conform beautifully to a version of the credit that has no legal existence.

The cure is unglamorous: one authoritative record per credit, holding the base instrument, every amendment with its status, and the resolved effective terms; every check, the workability review, the back-to-back mirror, and above all the pre-presentation document examination, runs against the resolved state, never against a single message. And when an amendment lands, the checks re-run, because an amendment that looks like a favour (more time to ship) can carry a rider that is not (a new document requirement) and partial acceptance is not an option.

Frequently Asked Questions

What is the difference between MT700 and MT707?

The MT700 is the SWIFT message by which an issuing bank issues a documentary credit; its numbered fields carry the credit's terms. The MT707 is the message by which the bank issues an amendment to an existing credit; it states only the changes. The credit's current state is the MT700 with all accepted MT707s applied in sequence.

Does a beneficiary have to accept a letter of credit amendment?

No. Under UCP 600 article 10 the beneficiary may accept or reject an amendment, and the terms of the original credit remain in force for the beneficiary until acceptance. Acceptance may be given by notification, or silently, by presenting documents that comply with the amendment. Partial acceptance of a single amendment is not allowed and is treated as rejection.

Which version of the letter of credit are documents checked against?

Against the credit as amended by every amendment in force at presentation: the effective terms. Checking against the credit as originally issued, or against the latest amendment in isolation, are both wrong, and both are common causes of avoidable discrepancies.

Can two amendments to a letter of credit conflict?

Yes. Amendments are drafted at different times, sometimes by different people, and can touch the same field. Where accepted amendments conflict, the later one governs that field. Keeping a resolved, current state of the credit, rather than a folder of messages, is the only reliable way to know what the operative terms actually are.

How Phlo Systems helps

opsPhlo treats the credit as a sequence, because that is what it is. It extracts terms from the MT700, the bank PDF or pasted text, registers each MT707 with its status, resolves everything into the credit's effective terms, and runs every check, workability, mirror and full document examination, against that resolved state. When a new amendment arrives, the checks re-run automatically. See the opsPhlo L/C workbench.

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Related reading:

• Why are most letter of credit presentations refused on first presentation?
• Can AI check letter of credit documents?

Saurabh Goyal is the Founder & CEO of Phlo Systems. He has built finance and trading systems for commodity houses since 2008.