What are the payment methods for foreign trade?

To do foreign trade, you need to know about the payment methods and payment methods, because foreign trade involves payment and collection. After understanding the relevant methods, you need to open an account. So what are the payment methods for foreign trade?

1. Letter of Credit (L/C) has many types.

Second, remittance , mainly including telegraphic transfer (T/T), mail transfer (M/T) and demand draft (D/D).

3. Collection , mainly includes two types: Documents against Payment (D/P) and Documents against Acceptance (D/A).

D/P means Documents against Payment. After we ship the goods, we prepare the documents for negotiation and deliver them to the customer's bank through our bank. The customer's bank will notify the customer that the documents have arrived. The bank will deliver the documents after the customer pays.

D/A means documents against acceptance, which means that our bank delivers the documents to the customer's bank. The difference is that the customer only needs to accept our documents, then he can take the original documents and pay after the due date.

T/T is telegraphic transfer (the documents are usually mailed directly to the customer by us without going through a bank). If we use T/T payment with our customers, the general practice is that the customer must first give us a 30% advance payment, and the remaining 70% is generally safer. After the goods are loaded, the customer pays with the original bill of lading faxed by us, and then mails the full set of original documents to the customer after the payment is received.

Generally speaking, the most common payment methods for foreign trade are letters of credit, remittance and collection. Remittance is most commonly used for payment settlement between countries and between enterprises.