A Transferable Documentary Credit (DC) is a DC with the option to allow an intermediary agent to transfer their rights and obligations to the supplier. As a result the supplier is also required to meet your terms and conditions.
A Transferable DC is often used when:
The intermediary agent is unable to supply some or all of the goods stipulated in the DC and therefore wishes to transfer part, or all, of the credit
The intermediary agent is unable to secure back-to-back credit facilities from their bank and the supplier demands settlement by DC
The intermediary agent acts as the sourcing agent and is responsible for distributing portions of the DC (usually a large amount) to various suppliers