Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
COMMON PAYMENT TERMS•   Cash in Advance•   Documents against Payment/DA•   Open Account•   Letter of Credit
CASH IN ADVANCE• Receive cash from the buyer before shipping  – Telegraphic Transfer  – Demand Draft• In case of HUGE paym...
DOCUMENTS AGAINST PAYMENT• When the importer’s bank sends a collection  notice to the importer, the importer pays thus  ta...
DOCUMENTS AGAINST ACCEPTANCE• When the importer’s bank sends a collection  notice to the importer, the importer gives the ...
OPEN ACCOUNT              Ship the goodsforward the shipping docs directly to buyer           await payments ……
A LETTER OF CREDITA L/C is A formal document of payment Opened by a party wishing to import Communicated through banking c...
Parties to a letter of credit   – Applicant/Importer   – Exporter   – Issuing Bank   – Intermediary Bank/Confirming Bank
Documentary Credit Cycle                                        (1) Contract       EXPORTER- SELLER                       ...
L/C PAYMENT PROCEDURE
L/C PAYMENT PROCEDURE
L/C PAYMENT PROCEDURE
L/C PAYMENT PROCEDURE
L/C PAYMENT PROCEDURE
Types of letters of credit• Sight L/C                   • Transferable L/C• Usance L/C                  • Anticipatory L/C...
RISK vs. TERMS of PAYMENT
Comparison of Various Methods of                Payment                Goods                           Usual Time        R...
Comparison of Various Methods of                Payment                         Goods                                     ...
Terms of payment
Upcoming SlideShare
Loading in …5
×

Terms of payment

11,054 views

Published on

  • www.HelpWriting.net is a really good site. thanks
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • You might get some help from ⇒ www.WritePaper.info ⇐ Success and best regards!
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • My personal experience with research paper writing services was highly positive. I sent a request to ⇒ www.HelpWriting.net ⇐ and found a writer within a few minutes. Because I had to move house and I literally didn’t have any time to sit on a computer for many hours every evening. Thankfully, the writer I chose followed my instructions to the letter. I know we can all write essays ourselves. For those in the same situation I was in, I recommend ⇒ www.HelpWriting.net ⇐.
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • Hi there! I just wanted to share a list of sites that helped me a lot during my studies: .................................................................................................................................... www.EssayWrite.best - Write an essay .................................................................................................................................... www.LitReview.xyz - Summary of books .................................................................................................................................... www.Coursework.best - Online coursework .................................................................................................................................... www.Dissertations.me - proquest dissertations .................................................................................................................................... www.ReMovie.club - Movies reviews .................................................................................................................................... www.WebSlides.vip - Best powerpoint presentations .................................................................................................................................... www.WritePaper.info - Write a research paper .................................................................................................................................... www.EddyHelp.com - Homework help online .................................................................................................................................... www.MyResumeHelp.net - Professional resume writing service .................................................................................................................................. www.HelpWriting.net - Help with writing any papers ......................................................................................................................................... Save so as not to lose
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • I thought I was good at writing essays all through freshman and sophomore year of high school but then in my junior year I got this awful teacher (I doubt you’re reading this, but screw you Mr. Murphy) He made us write research papers or literature analysis essays that were like 15 pages long. It was ridiculous. Anyway, I found ⇒ www.HelpWriting.net ⇐ and since then I’ve been ordering term papers from this one writer. His stuff is amazing and he always finishes it super quickly. Good luck with your order!
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here

Terms of payment

  1. 1. COMMON PAYMENT TERMS• Cash in Advance• Documents against Payment/DA• Open Account• Letter of Credit
  2. 2. CASH IN ADVANCE• Receive cash from the buyer before shipping – Telegraphic Transfer – Demand Draft• In case of HUGE payments (importer may demand a bank guarantee)• Followed if exporter is in a strong trading position & particular product is not available
  3. 3. DOCUMENTS AGAINST PAYMENT• When the importer’s bank sends a collection notice to the importer, the importer pays thus taking the possession of documents
  4. 4. DOCUMENTS AGAINST ACCEPTANCE• When the importer’s bank sends a collection notice to the importer, the importer gives the ‘acceptance’ to pay at a later date I/O making payment upon receiving the collection notice
  5. 5. OPEN ACCOUNT Ship the goodsforward the shipping docs directly to buyer await payments ……
  6. 6. A LETTER OF CREDITA L/C is A formal document of payment Opened by a party wishing to import Communicated through banking channels Paid by the opening bank within a specified timeframe upon presentation of docs
  7. 7. Parties to a letter of credit – Applicant/Importer – Exporter – Issuing Bank – Intermediary Bank/Confirming Bank
  8. 8. Documentary Credit Cycle (1) Contract EXPORTER- SELLER IMPORTER - BUYER (BENEFICIARY) (5) Shipment (APPLICANT)(4) Advising (6) Documents (2) Application for negotiation (8) Retirement (9) Remit the payment EXPORTER’S BANK (NEGOTIATING/ IMPORTER’S BANK (3) L/C CONFIRMING BANK) (L/C ISSUING BANK) (7) Dispatch of Documents - Claim Reimbursement
  9. 9. L/C PAYMENT PROCEDURE
  10. 10. L/C PAYMENT PROCEDURE
  11. 11. L/C PAYMENT PROCEDURE
  12. 12. L/C PAYMENT PROCEDURE
  13. 13. L/C PAYMENT PROCEDURE
  14. 14. Types of letters of credit• Sight L/C • Transferable L/C• Usance L/C • Anticipatory L/C – red• Revocable L/C clause, green clause• Irrevocable L/C • Revolving L/C• Confirmed irrevocable L/C • Deferred payment L/C• Unconfirmed irrevocable • Transit L/C L/C • Restricted & unrestricted• With & without recourse L/C L/C • Negotiable L/C• Back to back L/C
  15. 15. RISK vs. TERMS of PAYMENT
  16. 16. Comparison of Various Methods of Payment Goods Usual Time Risk to Risk to Method Available of Payment Exporter Importer to BuyerCash In After Before Very Low Maximum-ReliesAdvance Payment Shipment on exporter to ship goods as orderedLetter of After When Very Low Assured ofCredit Payment documents quantity and alsoConfirmed are available quality at at shipment shipment ifUnconfirmed inspection report(Advised) is requiredDocumentary After On If draft unpaid, Assured ofCollection Payment presentation goods must quantity, alsoSight Draft of draft to be returned or quality, if goodsDocuments importer disposed of, are inspectedagainst usually at loss before shipmentPayment
  17. 17. Comparison of Various Methods of Payment Goods Usual Time Risk To Risk To Method Available To Of Payment Exporter Importer BuyerDocumentary Before payment On maturity of Relies on importer Minimal—Can checkCollection Time Draft draft to pay draft shipment forDocuments against quantity and qualityAcceptance before paymentConsignment Before payment, After use; Substantial risk Very Low exporter retains inventory and unless through title until goods warehousing cost foreign branch or are sold or used to exporter subsidiaryOpen Account Before payment As agreed Relies on importer Very Low to pay as agreed - complete risk

×