Inward Remittance is a type of settlement service where a foreign correspondent bank remits the funds to CEXIM and instructs CEXIM to remit to the payee (our customer).
The inward remittance includes telegraphic transfer (T/T), mail transfer (M/T) and demand draft (D/D), of which T/T is most frequently used.
Benefits for Payees (Exporters)
Fast Process: T/T is the quickest method to help the exporter collect payment timely and accelerate cash flow;
Low Cost: Compared with documentary credit and collection, remittance imposes the lowest charges for the exporter;
Simple Steps: It is simple to process and the payee does not have to prepare documents.
When Do You Choose Inward Remittance?
The importer and the exporter co-operate for a long time and have a mutual trust, so they only prefer the settlement method in simple steps with low cost;
Remittance is suggested if a high capital turnover and a low finance cost are in demand;
The supply of goods is tight, so the exporter can require the importer to accept payment in advance;
The commodity to be traded is in a buyer’s market in which the credit standing of the importer is high and the exporter is eager to expand the market, so the exporter can use open account to support the transaction;
Remittance can be used for proceeds under non-trade and capital items such as technology transfer fee and capital funds.
If the remittance is not received as scheduled, please make an enquiry in time;
Since remittance mainly relies on the commercial credit, please avoid the use of open account and be aware of your counterparty’s financial position even if under a long-established relationship;
Under open account, we suggest you use instruments such as bank guarantee, export credit insurance and factoring to mitigate the risks;
Under inward remittance, please choose the Incoterms （CIF or CIP）carefully and make a transportation insurance timely.