Documentary collection
Also called: cash against documents · CAD · D/P · D/A
A payment method in which the seller's bank forwards shipping documents to the buyer's bank, which releases them to the buyer only against payment (documents against payment) or acceptance of a bill of exchange (documents against acceptance). Banks do not guarantee payment, unlike under a letter of credit, and the ICC's URC 522 rules usually apply.
In practice
Because the buyer needs the documents to clear the goods, delays in collection can leave cargo waiting in temporary storage.
EU
Türkiye
UK
USARelated terms
- Letter of credit
- A payment undertaking by a bank, issued at the buyer's request, to pay the seller when it presents documents that strictly comply with the credit's…
- Bill of lading
- The transport document issued by an ocean carrier or its agent acknowledging receipt of goods for shipment. It evidences the contract of carriage…
- Temporary storage
- The status of non-Union goods from the moment they are presented to customs until they are placed under a procedure or re-exported. Goods are kept in…