This is a payment method where the price of the goods is paid by the purchaser before the shipment of the goods. The exporter sends the goods after collecting the price.
The purchaser can get a prepayment discount, as it will pay the price of the goods in advance.
Cash Against Documents
After the shipment of the goods, the related documents that represent the goods are sent to the importers bank through the exporters bank for collection of the price afterward.
Cash Against Goods
The importer transfers the price of the goods at the maturity date agreed with the exporter after the importer clears the goods shipped by the exporter through the customs.
Payment Against Acceptance Credit
A foreign trade method where after receiving the goods, the importer makes the payment at the maturity date agreed with the exporter.
So, the importer gets an opportunity to purchase goods from abroad with a deferred payment.
Payment Against Letter of Credit
Upon the request of the importer, the importers bank guarantees the payment in terms of the documents specified in detail and in the conditions of the letter of credit for the corresponding goods or service presented by the exporter.
The exporter will ensure all of the goods to be shipped completely and within the due term. Otherwise, the recipients bank will make no payment.