D/A peyment is Secure & Safety
Post 2 of 10
Replying to [mahdy]:
Please make a search in this forum. The answer is available in great detail. Seek and thy shall find....!![[em1]](http://img.alibaba.com/images/eng/style/icon/emoticons_smile.gif)
Please make a search in this forum. The answer is available in great detail. Seek and thy shall find....!
12 Jan 2008 18:09
Post 3 of 10
Replying to [mahdy]:
D/A payment is very risky as importer takes possession of goods just upon accepting drafts i.e. without making payment. The creditworthiness of importer is not known to you and you never know wether importer will make payment on maturity or not.
The better alternative is to ask your importer to issue usance lc in your favour. The goods under lc will be released to importer only after banker's acceptance. The risk of non-payment on maturity shifts from importer to importer's bank. The creditworthiness of bank is well established than the importer himself.
Regards
D/A payment is very risky as importer takes possession of goods just upon accepting drafts i.e. without making payment. The creditworthiness of importer is not known to you and you never know wether importer will make payment on maturity or not.
The better alternative is to ask your importer to issue usance lc in your favour. The goods under lc will be released to importer only after banker's acceptance. The risk of non-payment on maturity shifts from importer to importer's bank. The creditworthiness of bank is well established than the importer himself.
Regards
17 Jan 2008 10:40
Post 4 of 10
Replying to [spider man]
Absolutely on the button! But now a question to you.
Assume that the transaction is under an acceptance credit. The applicant takes delivery. He refuses to pay on due date, but goes to court, takes out an injunction or a 'stop payment' order from the court against the issuing bank - apparently because he claims the goods to be not per specifications.
What is the remedy for the beneficiary?
Inviting Ranger too to jump in. I am not sure I know the answer.
Absolutely on the button!
But now a question to you.Assume that the transaction is under an acceptance credit. The applicant takes delivery. He refuses to pay on due date, but goes to court, takes out an injunction or a 'stop payment' order from the court against the issuing bank - apparently because he claims the goods to be not per specifications.
What is the remedy for the beneficiary?
Inviting Ranger too to jump in. I am not sure I know the answer.
17 Jan 2008 19:33
Post 5 of 10
Replying to [mahdy]:
Forget this order if buyer required D/A, unless you have long-term relationship.
Forget this order if buyer required D/A, unless you have long-term relationship.
14 Mar 2008 03:28
Post 6 of 10
Replying to [mahdy]:You can try to get credit insurance from insurance company such as Ping Ah or Chinese Export Credit Insurance Company in China. If you can do business out of Hong Kong, you have choices such as Coface, AIG, Altradius for credit insurance on overseas buyers.
It is commonly used when LC is not available. Nowadays you could be missing out opportunities if you insist on that. It is not as risky as you think.
It is commonly used when LC is not available. Nowadays you could be missing out opportunities if you insist on that. It is not as risky as you think.
14 Mar 2008 12:54
Post 7 of 10
Replying to [mahdy]:
DA payment is Unsafe as buyer get delivery of goods without payment. He may refuse to make payment on due date.
Safest way of payment is TT or LC at sight.
In TT one can consider 30% as advace & remaining 70% against fax copy of BL.
DA payment is Unsafe as buyer get delivery of goods without payment. He may refuse to make payment on due date.
Safest way of payment is TT or LC at sight.
In TT one can consider 30% as advace & remaining 70% against fax copy of BL.
14 Mar 2008 16:30
Post 8 of 10
Replying to [veshopping1]:
It appears that the owner himself is certifying his own company and its products!
It appears that the owner himself is certifying his own company and its products!
18 Mar 2008 19:24
Post 9 of 10
Replying to [shreejiindia]: I don't think it's 100% safe..It's just depends on the amount of trust that you have on your customer...Majority of the business round the world is ultimately done on the basis of trust between the two parties concerned.You can take various insurance covers available to minimse your risk. But my suggestion is , not to , accept high value orders on D/A terms.
I have another poser , I import goods from a supplier in another country. I pay a certain amount , say 30% advance against the order value at the time of placement of order and balance 70% TT 45 days after the shipment is effected , by my supplier.
He sends the post shipment documents to me directly. Once goods land up in my warehouse , I distribute these to my local customer. Immediately on reciept , my customers complain the goods are faulty and cannot be sold...I am asked to take back all the goods and no payment is made to me...I cannot pay the balance to my supplier coz it is due to poor quality of his goods that I am in such a situation...I cannot bear a loss due to someone else's carelessness...what do I do ??
I have another poser , I import goods from a supplier in another country. I pay a certain amount , say 30% advance against the order value at the time of placement of order and balance 70% TT 45 days after the shipment is effected , by my supplier.
He sends the post shipment documents to me directly. Once goods land up in my warehouse , I distribute these to my local customer. Immediately on reciept , my customers complain the goods are faulty and cannot be sold...I am asked to take back all the goods and no payment is made to me...I cannot pay the balance to my supplier coz it is due to poor quality of his goods that I am in such a situation...I cannot bear a loss due to someone else's carelessness...what do I do ??
19 Mar 2008 21:48
Post 10 of 10
Quoting from [Sanpan2002]:
I have another poser , I import goods from a supplier in another country. I pay a certain amount , say 30% advance against the order value at the time of placement of order and balance 70% TT 45 days after the shipment is effected , by my supplier.
He sends the post shipment documents to me directly. Once goods land up in my warehouse , I distribute these to my local customer. Immediately on reciept , my customers complain the goods are faulty and cannot be sold...I am asked to take back all the goods and no payment is made to me...I cannot pay the balance to my supplier coz it is due to poor quality of his goods that I am in such a situation...I cannot bear a loss due to someone else's carelessness...what do I do ??
What about YOUR carelessness? Why should the supplier or the ultimate buyer (your customers) pay for it? You wish to earn your commission as agent/middleman with no trouble at all? Your customers know YOU, not your supplier. They'd look at YOU for the quality of the product you distribute. Haven't you heard of the term 'caveat emptor (buyer beware)'? Are you simply a post-office? Who sourced (identified, negotiated with) the supplier?
Come on ...man....!
![[em12]](http://img.alibaba.com/images/eng/style/icon/emoticons_surprised.gif){kind=icon}
01 Apr 2008 20:29
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