Documentary Collection

Documentary Collection is a payment method used in international trade where the seller ships goods and provides shipping documents to their bank. The bank then sends these documents to the buyer’s bank, which only releases them to the buyer after they pay or agree to pay in the future. This process ensures that the seller has proof their goods are shipped before the buyer receives the documents needed to claim them. It is less secure than a letter of credit but provides some protection for both parties in the transaction.