Advantages of Documentary collection
- Using documentary collection service is comparably simpler, faster and less expensive alternative option to counterparties, who are trading internationally;
- It can be used for counterparties with established trade relationship and further builds trust between partners;
- Importer can defer the payment of the shipped goods using D/A collection option upon mutual agreement with the counterparty;
- With D/P collection, documents will be dispatched to the importer only in exchange for payment, thus, exporter can receive the payment quickly after shipping the goods;
- Compared to an open account, documentary collection offers greater security of payment to exporter using documentary leverage;
- To mitigate fraud/default for both parties, they can agree on mixed payment method;
- No legal risks as it’s regulated by ICC.