Trade Operations

Question 1

What is international trade?

Answer 1

International Trade is the movement of goods and services across the borders of a nation and the payment for such goods and services.

Question 4

What are some methods of payment under international trade?

Answer 4

1. Advance Payment
2. Open account
3. Documentary collection
4. Letters of Credit
5. Guarantees

Question 5

Describe the flow of the advance payments

Answer 5

Importer and exporter discuss goods and the importer sends money to

Exporter through bank. Exporter sends goods and then mails documents. Importer uses mailed documents to clear importer surrenders goods. Cheating documents to bank to meet regulatory requirements.

Question 6

Who has the highest risk in advance payments?

Answer 6

Buyer sends money with no guarantee of receiving goods or being reimbursed

Question 7

What are some things on The operational checklist for advance payment?

Answer 7

1.there should be a customer request
2. An invoice should be attached
3. Undertaking
4. Request letter should be signed by account mandate and signature verified by account manager
5. Confirmation of transaction by named staff
6. Vetted and approved by your supervisor

Question 8

What is the message type for advance payment transactions?

Answer 8

MT103