Documentary collection is a good solution for conducting trade transactions and effecting transaction-related payments. Documentary collection works well when a long-term cooperation between the parties to the agreement is based on a spirit of trust but the trade partners are not yet prepared to trade without any security.
Documentary Collection is a payment mechanism whereby money is received, within specified timeframe and through Bank’s intermediation, from the buyer against presentation of financial and/or shipping documents. Therefore, Documentary Collection is a method that is more secure than an ordinary bank payment, provides the seller with sufficient payment security and ensures that the seller receives payment for goods or services:
In international trade, Documentary Credit is the most secure method of payment used both by importers and exporters. Documentary Credit is basically a guarantee for the both counterparties (the importer and the exporter) as it guarantees payment for goods or services. The payment is guaranteed upon presentation of relevant shipping documents serving as proof of the delivery of the goods. The payment is guaranteed only if all of the requirements of the Documentary Credit are met:
Documentary Credit is a contractual arrangement which is completely distinct and separate from the sales or other contracts on which it may be based. Both the importer and the exporter should differentiate transactions, which involve Documentary Credit, from other sales transactions. Documentary Credit explicitly outlines Bank’s obligations. Being involved in Documentary Credit, Bank deals solely in the documents representing the goods (services) covered by the underlying commercial contract and not in the goods or services themselves.
Documentary Credits are subject to the Uniform Customs and Practice for Documentary Credits, 2007 Revision, ICC Publication No 600 (“UCP”) or 1993 Revision, ICC Publication No 500 (UCP 500).
Letters of credit are among the most secure methods of payment and are respected internationally.
Guarantee is an irrevocable commitment delivered by Bank by which Bank undertakes to pay a defined amount of money, as specified in the Guarantee, in favour of the beneficiary (the third party in whose favour the Guarantee is issued) upon the beneficiary’s request whenever the principal defaults on his obligations set out in the Guarantee.
There are several different types of Guarantees issued by Baltic International Bank:
Bank issues Guarantees in accordance with the applicable laws of the Republic of Latvia and generally accepted international rules and usages of guarantees.
The opportunity to assess, together with Bank’s specialists, the feasibility of your project and to choose a documentary operation that best suits your business needs
Once you have filed your application, Bank’s specialist will contact you within the shortest possible timeframe to discuss with you your business needs and to choose, together with you, the most appropriate documentary operation
SAFETY AND SECURITY
Bank’s specialists will offer provisions working towards your individual needs. This will enable you to develop your business more flexibly and successfully and hedge yourself against potential risks
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