Commercial payment terms work best when the evidence required for payment matches the actual logistics process.

01

Start with the facts

Compare advance payment, open account, documentary collection and letters of credit against counterparty risk and operational capacity.

02

Build the operating plan

For any document-based instrument, review names, dates, descriptions, quantities and shipment conditions before dispatch. Small discrepancies can delay payment.

03

Validate the handoffs

Agree who prepares, verifies and submits each document and establish time to correct errors.

04

Close the loop

Banks and professional advisers should confirm instrument wording and jurisdiction-specific obligations.

Editorial note

This guide is general information. Requirements and commercial conditions vary by jurisdiction, product and date. Confirm a live transaction with the relevant licensed professionals.

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