I have started a business in trading of metal scrap. Some vendors work on letters of credit however, some work on bank transfers only and do not accept bank instruments. I currently have an opportunity for a trade deal for which I need a large some of money. I had an offer from someone who was offerring me a Standby Letter of Credit (SBLC) for a fixed fee to utilize for 1 year. I can then use this SBLC and get cash in the bank against this SBLC (again for a fixed fee). At the end of the year, I have to return this money and keep the profits generated.
I feel this fees that I have to pay is similar to interest payment, but I am not sure if this is correct. Can you suggest any other way to finance my trade which will be shariah compliant?