Hi all,

 

You know that L/C is most confident way to payment, but here is a question to me:

 

Is there any risk involved in L/C payment?

In case of opening L/C,is it possible to sell a product to a buyer without receiving any money?

 

Let us know your idea.

Well said Maria I totally agree with you.
Chinese companies please note Maria post.
I have yet to meet a naive chinaman,if you were honest enough with your trading terms ,you would agree to L/C payment terms.
L/C is like money in the bank T/T is money in the drain.
If you guys a serious honest chinese exporters you would accept L/C trading terms.

Beware Do not make T/T transfers

Beware Do not make T/T transfers

I prefer Indian Businessman any day they are trusworthy and provide you products exactly as per specification.

very interesting on talking about L/C. i know more thanks very much for all

OK I READ ABIA

L/C is not the safest way.There are documents but documents never say that the products you ordered are OK quality.For example sitting in Norway you can receive something different under name of sugar or electronic products.

I really believe there is a need of new B2B system.One company can control the money transfers and products also freights.If strong control starts nobody can scam or fraud.

 

Thank you much for your useful explanations.I benefit it.

 

Tarun wrote:

This is a typical question when one is into international trade and the concerns are even greater if you are dealing thru internet.

The seller and buyer both are risk in such situation. Both of fear of loosing their money/ goods/ quality issues/ timely delivery etc.

But The business deal can only take plce if both the parties concerned have some level of optimism and trust.

You have to follow your instincts, be very observative and use your experience in choosing your business partner, mode of payments etc.

LC is safer option, where both the parties set to agree forth written terms of trade, delivery and payment.

Each follow their set of conditions and the deal is completed thru the bank. But one must be carefull in interpreting the LC and following it carefully.


For the buyer, they can always have a agent, inspection company etc. to have their goods checked for the quality etc. at the factory itself, before shipment. This will protect interest of both the parties.

If you are familiar with the buyer and that you know that your products can be sold in buyers country easily, then you can accept to get some advance and balance by D/P thru the bank, where the seller wil have full control of the goods untill the buyer pays the bank and get the shipping document from the bank to claim his ownership. It is rather economical way, since the transaction costs are minimal.


Again the buyer must have inspection done at the factory itself before shipment.

If the product is a niche product, typically made for the buyer on their order, you must go for 100% advance before shipment, may be in parts as per your understanding with the buyer.

 

Dear Tarun, thank you much for your useful explanations.I benefit it.

maria Chen wrote:

L/C is based on the credit of a bank, so we should check the credit of the issuing bank before agree on the L/C. If no problem on L/C, then we should make sure that the document(Inovice, Packing list, C/O if any) is coherent to the clause of the L/C.

Certainly, L/C at sight is the best.

 

Thank you maria.I researched and as you said ,I found that Irrevocable Confirmed L/C at sight  isthe best for sellers.