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Video transcript

Documentary collection

A collection bill is a way to improve risk and cashflow without the need for banking facilities when both importing and exporting.

Also known as DP, documents against payment, the collection bill is a way of routing the documents through the banking system.

Original shipping documents are only released to the buyer once payment for the goods has been made.

The seller therefore retains physical control of the goods until they get paid. If payments not made the documents and therefore, control of the goods reverts to the seller.

So how can this process help both importer and exporter? If you're importing instead of paying upfront the cash position can be improved by paying when the ship is about to arrive.

If you're exporting, you maintain control of the goods until you get paid.

Neither the importer or exporter need a facility.

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