International settlement methods

There are four common international settlement methods in international trade as follows.

1.100% T/T advance
100% payment to production. Note that this is the payment to production, but also a way not payment to delivery. This payment method means that the full payment is received before production begins, and the risk of this payment method is the greatest for the importer. Generally only in the sample order or small orders using such a payment method. 

2. T/T deposit + T/T final payment before shipment
This payment method is very safe for both importers and exporters, but the deposit percentage needs to be negotiated between the two parties.

3.T/T deposit + T/T final payment on demand letter of credit
Generally speaking, it is 30% T/T and 70% final payment L/C. This payment method is almost as safe as the second payment method. It is also a very safe way of payment. The difference is that with this payment method, the exporter will provide customs clearance documents only after the goods are on board and the bill of lading is obtained.

4. Part of the deposit, part of the final payment see copy of B/L
This payment method is the most common payment method. The common ratio is 30% T/T, 70% of the final payment see bill of lading copy. In practice, there will be some changes, the specific payment ratio of the exporter and the importer can negotiate.
Written by Karla