Name
Collection against contract of purchase
Introduction
Collection against contract of purchase is a settlement method that the payee entrusts his bank to collect payments from the payer in another city under the contract of purchaseafter goods delivery, and ask payer’s acceptance. Collection against contract of purchase is available only for inter-city settlement.
Features
1. The payer and the payee should stipulate collection against contract of purchase as the settlement mode;
2. The payer's bank bears examination obligation to items agreed upon by the payee and the payer, when the payer refuses to pay.
Scope of Application
It is applicable to entity customers for domestic inter-city settlement of payments agreed upon by both parties in the contract.
Application Requirements
The payer and the payee must sign the purchase and sale contract, and stipulate collection with acceptance as the settlement method in the contract.
Process
1. The payee fills the M/T(Mail Transfer) or T/T(Telegraphic Transfer) collection with acceptance voucher, and submits it together with the shipping documents (or other relevant documents) and trading bills to payee's bank;
2. The remitting bank（the payee's opening bank）initiates payment collection to the payer's bank;
3. The remitting bank delivers the account record receipt to the payee after collection.
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