Payment against Documents. The issuing bank shall pay the beneficiary (exporter) the documents that meet the requirements of the credit as the payment terms. In the letter of credit, the "payment of bills" clause is generally indicated (ie, the issuing bank is responsible for the text). The beneficiary (exporter) of the letter of credit is required to submit the payment as long as it submits the documents that meet the requirements specified in the letter of credit.
It differs from the “payment presentation†under the collection method in that the collecting bank of the collection method does not hand over the documents before the importer (buyer) pays the goods, that is, the importer (buyer) only delivers as required. After payment is made, documents can be obtained from the collecting bank to collect or resell the goods. Whether the importer (buyer) pays as required, the collecting bank does not take any responsibility. Under the letter of credit method, the beneficiary (exporter) can directly submit to the issuing bank a single payment that meets the requirements of the letter of credit without first looking for an importer (buyer). This is the issuing bank's beneficiary (exporter). It is an independent responsibility.
An Outward Documentary Bills bank is a business funded by exporters under the letter of credit. That is, the bank advances all palm rests with the exporter’s full set of export documents as collateral.
Export bills generally go through the following processes:
(1) After accepting the application, when the exporter submits the application for bill payment after exporting the goods, the exporting bank must carefully review the entire contents of the letter of credit and understand the credit of the exporter, and then accept the application and ask the exporter to fill in the “export†BANKING APPLICATION";
(2) Examination documents. After the exporter fills in the application form, the full set of shipping documents such as bills of exchange, invoices, bills of lading and insurance policies shall be submitted to the bank for financing. The embedded bank shall strictly review all the documents;
(3) Purchasing the bill of exchange, and the bank's examination of the bill is correct, that is to buy the bill of exchange of the exporter and all the shipping documents as collateral advanced to the exporter's funds;
(4) Advance payment, bank purchaser's documentary draft, deducting interest, handling fee and other expenses from the nominal amount, and paying the exporter to the exporter;
(5) After recovering the payment, the bank of the exporter will pay the exporter the advance payment, and then he will obtain the ownership of the shipping document. He shall return the payment to the bank that issued the letter of credit at the importing location. If the payment is refused due to a discrepancy between the documents, the bank of the exporting country has the right to claim all advances and interest from the exporter or deal with the collateral. If the bank refuses to pay due to the bank’s own work mistakes, the bank must not pursue the exporter.
Export bills have played a financial role for both importers and exporters. Exporters can receive funds before the importer pays the full amount.
It differs from the “payment presentation†under the collection method in that the collecting bank of the collection method does not hand over the documents before the importer (buyer) pays the goods, that is, the importer (buyer) only delivers as required. After payment is made, documents can be obtained from the collecting bank to collect or resell the goods. Whether the importer (buyer) pays as required, the collecting bank does not take any responsibility. Under the letter of credit method, the beneficiary (exporter) can directly submit to the issuing bank a single payment that meets the requirements of the letter of credit without first looking for an importer (buyer). This is the issuing bank's beneficiary (exporter). It is an independent responsibility.
An Outward Documentary Bills bank is a business funded by exporters under the letter of credit. That is, the bank advances all palm rests with the exporter’s full set of export documents as collateral.
Export bills generally go through the following processes:
(1) After accepting the application, when the exporter submits the application for bill payment after exporting the goods, the exporting bank must carefully review the entire contents of the letter of credit and understand the credit of the exporter, and then accept the application and ask the exporter to fill in the “export†BANKING APPLICATION";
(2) Examination documents. After the exporter fills in the application form, the full set of shipping documents such as bills of exchange, invoices, bills of lading and insurance policies shall be submitted to the bank for financing. The embedded bank shall strictly review all the documents;
(3) Purchasing the bill of exchange, and the bank's examination of the bill is correct, that is to buy the bill of exchange of the exporter and all the shipping documents as collateral advanced to the exporter's funds;
(4) Advance payment, bank purchaser's documentary draft, deducting interest, handling fee and other expenses from the nominal amount, and paying the exporter to the exporter;
(5) After recovering the payment, the bank of the exporter will pay the exporter the advance payment, and then he will obtain the ownership of the shipping document. He shall return the payment to the bank that issued the letter of credit at the importing location. If the payment is refused due to a discrepancy between the documents, the bank of the exporting country has the right to claim all advances and interest from the exporter or deal with the collateral. If the bank refuses to pay due to the bank’s own work mistakes, the bank must not pursue the exporter.
Export bills have played a financial role for both importers and exporters. Exporters can receive funds before the importer pays the full amount.
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