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How does a Documents against Acceptance (D/A) collection work?
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| Steps 1 - 4 |
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Importer |
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The importer accepts the Bill of Exchange and returns it to his or her bank. |
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Importer's Bank |
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Upon receipt of the accepted Bill of Exchange, the importer's bank releases the export documents to the importer. The importer's bank will also advise the exporter's bank of the due date for payment. |
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Importer's Bank |
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On the due date for payment, the importer's bank will approach the importer for payment and provided the importer has the money will remit the proceeds to the exporter's bank. |
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Exporter's Bank |
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The exporter's bank receives the money from the importer's bank and pays it to the exporter less any charges due. |
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