What is remittance settlement

Remittance settlement is a way of payment by the debtor through the bank to the creditor

Remittance settlement according to the use of notice of different ways can be divided into the following three categories.

1. wire transfer. It refers to the remittance line at the request of the remitter by telegraphic means entrusted to the inward bank to pay the payee settlement. The use of wire transfers, the payee can quickly collect the money, but the payer has to bear more costs.

2. letter remittance. It refers to the remittance should be remitter's request to letter entrusted to the remitter bank to pay the payee settlement. The use of letter remittance, letter remittance costs are smaller, but the remittance is slower.

3. Ticket remittance. It refers to the remitter to the remittance line to buy a bank draft sent to the payee, the payee according to the draft on the designated bank to collect money settlement. Ticket remittance is a bank draft as a settlement instrument.

There are two kinds of bills of exchange: single bill of exchange and double bill of exchange. Single bill of exchange to prevent loss, should be double-registered, it is usually used for the amount of smaller bills of exchange; duplicate bills of exchange have two, such as in the case of bills of exchange late or lost, can be exchanged with the vice. Therefore, the first and second two bills of exchange should be mailed separately, it is usually used for larger amounts of money orders.

The remittance settlement method is entirely based on commercial credit. Both sides of the transaction according to the contract or economic matters of prepayment or cash on delivery, prepayment importers have the risk of not receiving the goods; and cash on delivery exporters have the risk of not receiving the payment. Due to the high risk of remittance settlement, this settlement method is only applicable on the basis of high trust between the import and export parties. In addition, the settlement of the balance of payments, payment of commissions, return of advances, claims, the sale of a small number of samples can also be used.

(C) remittance in the import and export business and the risks

Remittance mode in international trade has two uses: prepayment and postpayment. Prepayment and postpayment are unfavorable to both buyers and sellers

but buyers and sellers can be used as long as it is suitable for his business intentions.

But both buyers and sellers can use them if it suits their business intentions.