📄 DOCUMENTS AGAINST PAYMENT (D/P)
US Capital Private Bank Knowledge Base
📖 What is Documents Against Payment (D/P)?
Documents Against Payment (D/P) are instructions given by a shipper to their bank, specifying that shipping documents are to be delivered to the drawee (buyer/payer) only upon payment of the draft.
⚙️ Key Features
-
The buyer must pay the draft immediately to receive the shipping documents.
-
The bank acts as a collecting agent, ensuring that payment is made before releasing control of the goods.
-
Commonly used when the seller wants to minimize risk by requiring payment upfront.
💡 Purpose and Benefits
-
Protects sellers by ensuring payment before the buyer obtains the goods.
-
Helps facilitate secure international trade transactions.
-
Provides the buyer with proof of ownership through the shipping documents once payment is made.
⚠️ Considerations
-
Payment is due immediately on presentation, unlike Documents Against Acceptance where payment is deferred.
-
Buyers must have sufficient funds to pay the draft to take possession of goods.
-
Banks do not guarantee payment but act as intermediaries to enforce payment terms.
🔄 Related Terms
-
Documents Against Acceptance (D/A) – Documents released upon acceptance of a time draft rather than immediate payment.
-
Time Draft – Draft payable at a future specified date after acceptance.
📞 Contact US Capital Private Bank
📧 Email: [email protected]
🌐 Website: https://uscapitalprivatebank.com