MT 734 Explained: Advice of Refusal

MT 734 is the bank examining documents under an LC formally telling the presenting bank it's refusing to honour or negotiate them — because they don't strictly comply with the credit's terms. Under UCP 600, a bank has a maximum of five banking days after presentation to decide, and if it refuses, it must state every discrepancy at once rather than raising them one at a time.

Key fields

• 20 — Sender's Reference: Reference for this refusal advice.
• 21 — Documentary Credit Number: The LC the documents were presented under.
• 32a — Amount of Documents Refused: The value of the specific presentation being refused.
• 33a — Total Amount Claimed: What was actually claimed under the presentation, if different.
• 77J — Discrepancies: The core of the message — the exact list of every way the documents fail to comply.
• 77B — Disposal of Documents: States what's happening to the physical/electronic documents now — held pending instructions, being returned, or released against a trust receipt.

A refusal doesn't necessarily end the transaction — the applicant can still waive the discrepancies and instruct the bank to pay anyway, which is where a message like MT 750 or a direct authorization comes back into play.