Professional Documents
Culture Documents
Chương 6
Chương 6
Chương 6
INTERNATIONAL
PAYMENT
MSC Tăng Minh Hưởng
What is money?
• It is a special commodity that serves as a
common medium of exchange for trading
with other types of goods.
• It has the highest liquidity.
• Gold is a very special type of money that
can be used for buying and selling
transactions in most countries.
• In words:
• United states dollars one million only (chẵn)
• ....TWELVE CENTS ONLY => WRONG
•T/T in advance benefits the exporter but disadvantages the importer. Conversely, deferred payment
benefits the importer. The longer the tenor for deferred payment, the more advantageous it is for the
importer. For example, T/T within 120 DAYS AFTER SHIPMENT DATE is highly beneficial for the
importer.
•Remittance: APPLICABLE only when the parties trust each other or the contract is of low value (<
USD10,000.00).
•Down Payment/Deposit:
•For Exporter: i) Need money for production – purchase of raw materials, machinery, hiring labor.
ii) To avoid stockpiling of orders.
•For Importer: i) Loss if goods are not shipped, exporter retains the money. ii) If no money
transferred, exporter does not accept, order fails. Approaches to dealing with agreements for T/T
in advance and T/T deferred payment:
Borrowed funds from the bank (Importer signs Credit Contract with the Bank):
• Unsecured loan (A form of loan without collateral) – High interest rate for lending. High Risk –
High profit.
• Secured loan (Collateral: raw materials, factories, machinery, real estate ... A form of loan with
collateral that reduces the bank's risk compared to unsecured loans) – The interest rate for
secured loans will be lower than unsecured loans.