Author Archives: Chetan Kadam

The second most important and commonly used documentary collections method is called, Documents against Acceptance or also known as DA. Whether the seller/drawer or the buyer/drawee uses DA or DP terms, for their trade settlement, is always pre-decided at the stage of the sales contract, formally, or when the purchase orders or pro-forma invoices areContinue reading “Documentary Collections Part 2-b”

Further to my last blog, we will now see the 2 main types of Documentary Collections that are most commonly used…. Documents against Payment (DP), also commonly known in the business community as, Cash against Documents (CAD), however the term used in URC 522, is DP. Documents against Acceptance (DA) Generally the buyers and sellersContinue reading “Documentary Collections Part 2-a”

In my last blogs we saw the two methods of trade settlements (advance payment/open account) which are commonly used by buyers and sellers worldwide. Advance payment and Open account, both, do not involve banks, in terms of routing of documents, or payment obligations. The buyer simply, uses the banking network for making a remittance toContinue reading “Documentary Collections Part 1”

This method of trade settlement is exactly opposite to Advance payment, and is generally used when the buyers dictate the market dynamics or when the buyers are larger corporates, and sellers are SME’s. The sellers are required to ship the goods prior to receipt of any payment, or in some cases might receive a percentageContinue reading “Open Account”

Further on, we now come to the first method of trade settlement/ payment In the ever so fluid landscape of business, the market dynamics, the demand and supply change ever so rapidly, especially when we have such an interconnected world. In a business situation wherein the market dynamics and the demand and supply, lean moreContinue reading “Advance payment”

There are 4 classical methods of trade payments or settlements, in local and cross border trade. The usage of each method entirely depends on the following…. Relationship between the buyer and the seller Financing options available Economics – buyers market / sellers market Market risks Country risks The following 4 methods of trade payment areContinue reading “Methods of Trade payments”

Be yourself; Everyone else is already taken. — Oscar Wilde. This is the first post on my new blog. I’m just getting this new blog going, so stay tuned for more. Subscribe below to get notified when I post new updates.

Thank you visiting my blog. I am a professional practitioner in international trade for the past 15 years, and have spent most of this time in advising clients on the appropriate application of the methods of trade payment and the usage of trade instruments, to mitigate payment and performance risk in local and cross borderContinue reading “Introduction”