General

We do foreign trade to make money. So in import and export trade, receiving and paying is a very important link. Foreign trade newcomers are not very familiar with payment methods. We will explain the 5 common foreign trade payment methods for your reference.

1. T/T telegraphic transfer, TT has front T/T and back T/T, both of which are commercial credit, easy to operate, and have no additional fees. In other words, it is equivalent to a domestic bank transfer, just submit the account number and transfer value. The difference is that domestic transfers are received immediately, while overseas transfers require a period of time to wait.

2. Agent payment is applicable to individual SOHO and small and medium-sized enterprises. As there is no import and export right to choose a foreign trade payment method, this foreign trade payment method can avoid risks. It is to find a large-scale foreign trade comprehensive enterprise, and according to the national import and export process, as long as it is legal trade, it can be done. It can not only improve the ability to receive orders, but also Profit maximization. The advantage of doing this is that you are a foreign trade company, and you can find them to act as an agent for anything that a foreign trade company can do.

3. L/C letter of credit, also known as forward and sight, refers to a written guarantee issued by the issuing bank to make payment within a specified time limit based on documents that meet the requirements of both the buyer and seller. L/C letter of credit is relatively safe due to its bank guarantee, making it the most common foreign trade payment method in foreign trade.

4. D/A D/A acceptance is a payment method in which the exporter issues ownership and other shipping documents to the importer after the importer accepts the bill of exchange at the request of the collecting bank.

5. D/P payment against documents, which means that when the exporter submits the remittance and the same shipping documents to the bank for collection, and requires the bank to hand over the shipping documents only after the importer has paid the full amount. According to different payment times, it can be divided into sight payment and forward payment.

These types of foreign trade payment methods each have their own advantages, some are convenient and fast, some are relatively safe, and some have cheap fees. So, which payment method to choose depends on your actual situation.