An Irrevocable Letter of Credit (ILOC) is a financial document issued by a bank that guarantees payment to a seller, provided that the seller meets specific terms and conditions. Unlike a revocable letter of credit, an ILOC cannot be changed or canceled without the consent of all parties involved, including the buyer, seller, and issuing bank. This provides a higher level of security for the seller, ensuring they will receive payment as long as they fulfill their obligations. ILOCs are commonly used in international trade to facilitate transactions between buyers and sellers from different countries. They help reduce the risk of non-payment and build trust between parties. When the seller presents the required documents, such as shipping receipts or invoices, the bank will release the funds to them, ensuring a smooth transaction process.