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FINANCIAL MARKET COURSES

Documentary Collections

Documentary collection is a service provided by banks to sellers (exporters) involved in international trade. To some extent, you can think of a documentary collection as an international ‘cash on delivery’ method of payment. The buyer either pays for goods at delivery or gives an undertaking to pay for them in the future by signing an enclosed draft or bill of exchange. However, there are a couple of crucial distinctions between a typical cash on delivery transaction and a documentary collection.

 

This course describes how documentary collections work, distinguishes the different types, outlines the role of the parties involved, and lists the benefits and drawbacks of this method of payment. It also explains the Uniform Rules for Collections (URC), the internationally recognized rules covering collection operations for documentary collections.

  • OBJECTIVES

    On completion of this course, you will be able to:

    Describe how documentary collections facilitate payment in international trade

    Outline the requirements of the key sections of the ICC’s Uniform Rules for Collections (URC)

  • COURSE OUTLINE

    Topic 1: Overview of Documentary Collections

    What is a Documentary Collection?

    Parties to a Documentary Collection

    o Seller/Exporter

    o Remitting Bank

    o Presenting/ Collecting Bank

    o Buyer/Importer

    Documents Required

    The Documentary Collection Process

    Benefit & Drawbacks of Documentary Collections

    o Buyer’s Perspectives

    o Seller’s Perspectives

    D/P or D/A – Which is Better for the Seller?

    The Role Of Banks?

    Topic 2: Uniform Riles for Collections (URC 522)

    What is URC 522?

    Collection Instruction (article 4)

    Presentation (article 5)

    Release of Commercial Documents (article 7)

    Documents vs. Goods/Services/Performances (article 10)

    Disclaimers (articles 11-15)

    Payment (16-20)

    Interest Charges & Expenses (articles 20-21)

    Other Provisions (articles 22-26)

  • PREREQUISITE KNOWLEDGE

  • ESTIMATED COMPLETED TIME

    50 Minutes

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