I’m looking at importing and exporting, what is a documentary collection?

Last Updated: 21 Jun 2016

Individual banks act as agents to monitor the delivery of the relevant documents to enable goods to be released to the importer and for payment to the supplier (the exporter).

With a term documentary collection, the exporter offers credit to the importer who, having accepted the documents, pays for the goods at a later date (known as documents against acceptance). This means the exporter trusts  the importer will pay on the due date.

For sight documentary collections, the importer pays immediately on presentation of the collection documents (known as documents against payment). This type of collection offers slightly more protection for the exporter while the importer must pay on sighting the documents.

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