📄 DOCUMENTS AGAINST ACCEPTANCE (D/A)
US Capital Private Bank Knowledge Base
📖 What is Documents Against Acceptance (D/A)?
Documents Against Acceptance (D/A) refers to instructions given by a shipper to their acceptance bank indicating that shipping documents attached to a time draft for collection should be delivered to the drawee (buyer/payer) only after they accept the draft.
⚙️ Key Features
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The drawee/payer accepts a time draft, promising to pay on a specified future date.
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The shipping documents (such as bill of lading) are released only upon acceptance, allowing the drawee to take possession of the goods.
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The bank acts as a collecting agent, facilitating the transaction between seller and buyer.
💡 Purpose and Benefits
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Allows buyers to obtain possession of goods before payment is made, based on acceptance of a draft payable later.
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Provides sellers with a formal commitment to pay by accepting the draft.
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Common in international trade where sellers extend credit terms to buyers.
⚠️ Considerations
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Risk exists for sellers if buyers fail to pay on maturity after acceptance.
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Sellers rely on the legal enforceability of the time draft acceptance.
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Banks do not guarantee payment, only handle document delivery and collection.
🔄 Related Terms
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Time Draft – A draft payable at a future specified date after acceptance.
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Documents Against Payment (D/P) – Documents released only upon immediate payment, not acceptance.
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🌐 Website: https://uscapitalprivatebank.com