Documentary collection

We recommend choosing SEB bank Documentary Collection in cases, when you would like to limit the transaction risk, and:

• You have a known and/or long-term international partner, with whom you have already done business transactions;
• You as a seller do not have doubts about buyer's ability to pay and its willingness to pay for goods;
• Goods that can be stored for longer periods or that can be sold easily or that can be shipped back are purchased;
• Goods, whose purchase documents guarantee ownership rights are purchased. For example, in case of sea transit a bill of landing is issued that confirms the ownership rights to the goods in transit. Without the mentioned document buyer can not receive goods and, in order to receive it, the buyer should pay the amount mentioned in Documentary Collection documents to the bank;
• Destination for delivering goods is outside of Latvia and for its transportation you need to use transfer by ship;
• Political and economic situation in the buyers country is stable;
• There are no any currency payment restrictions set in seller's country.

What is provided by Documentary Collection

Documentary Collection – in comparison with regular bank payment order – is more secure way of receiving payment for goods or services. Documentary Collection is cashing in amount of money from buyer in certain term in exchange for financial and/or trade documents with the assistance of a bank:

• For the seller Documentary Collection serves as a guarantee that the buyer will receive documents only after paying for goods;
• The Buyer does not need to pay advance payment but payment in exchange for documents confirming delivery of goods in accordance with conditions in the agreement.

Unlike with Letter of Credit, in case of Documentary Collection the bank will not undertake commitment and responsibility for making payments.

It means that Documentary Collection does not guarantee timely payment to the seller from the buyer and does not provide a guarantee, that the buyer will receive goods. The bank is only a mediator that will keep transaction documents until the payment will be made for goods or services, as well as will remind the buyer about the payment deadline.

Documentary Collection is a separate, independent transaction from trade or other agreements – all parties involved in Documentary Collection are operating only with documents, not goods or services that there documents refer to.

Documentary Collection is a safe and internationally recognized type of payment – its operations are regulated by rules issued by the International Chamber of Commerce "United Collection regulations" Nr. 522, 1995, version (URC 522). SEB bank has a significant international trade experience – we have secured Documentary Collection transactions not only in Europe and the United States, but also in such countries as Uruguay, Pakistan, Nigeria and others.

Documentary Collection professing for standard transaction at SEB bank costs on average no more than EUR 150. Most often SEB bank service costs are covered by SEB bank clients.