💵 CASH AGAINST DOCUMENTS (CAD)
US Capital Private Bank Knowledge Base
📖 What is Cash Against Documents (CAD)?
Cash Against Documents (CAD) is a payment method where the buyer pays cash to receive the title documents (such as bill of lading, invoice, and other shipping papers) through an intermediary, usually a bank. These documents are required to take possession of the goods.
⚙️ How Does It Work?
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The exporter ships the goods but retains control of the shipping documents.
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The documents are sent to a bank acting as an intermediary.
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The bank releases the documents to the buyer only after payment is made.
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Once the buyer pays cash, they receive the documents and can claim the goods.
💡 Why Use Cash Against Documents?
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Offers the exporter some security by ensuring payment before the buyer obtains the goods.
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The buyer has assurance the goods have been shipped before payment.
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Useful when buyers and sellers have some established trust but want security for the transaction.
⚠️ Risks and Considerations
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The buyer cannot take possession of the goods without payment.
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The exporter ships goods before receiving payment, so there is some risk if the buyer refuses to pay.
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Relies on efficient coordination between banks and documentation.
🔄 Common Uses
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International trade transactions involving physical goods.
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Situations where a letter of credit is not used but payment security is needed.
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Markets with moderate risk between trading partners.
📞 Contact US Capital Private Bank
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🌐 Website: https://uscapitalprivatebank.com