Documentary Collection

About

Documentary collection represents handling by banks of commercial and/or financial documents in compliance with received instructions for payment or acceptance, or delivery of documents under other terms.

Types

There are two types of documentary collection:

  • „clean collection“ – collection of financial documents (bills of exchange, promissory notes);
  • „documentary collection“ - collection of commercial documents (invoices, transport documents, shipping documents or other similar documents) that may also be accompanied by financial documents (bills of exchange, promissory notes).

Collection Instructions

The most common collection instructions are:

  • Documents against payment  (or D/P). The documents, subject to collection, are released to the payer against payment;
  • Documents against acceptance (D/A). The documents, subject to collection, are released to the payer against acceptance (acceptance for payment) of a bill of exchange;
  • „Free of payment“ - The documents, subject to collection, are released to the payer without payment.

Advantages

The Bank may additionally offer other services, accompanying the collection one:

  • providing aval to accepted for payment bills of exchange;
  • discounting of promissory notes;
  • discounting of accepted for payment bills of exchange.
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