documents against acceptance

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A method of payment for goods that have been exported in which the exporter sends the title and shipping documents with a bill of exchange to a bank or agent at the port of destination. The bank or agent releases the goods when the bill has been accepted by the consignee. Provided the documents are in order, there is an obligation to pay for them even if the goods have been lost in transit. In these circumstances, the buyer would hold the insurance policy to provide recompense for the lost goods. Compare cash against documents.

Subjects: Business and Management — Economics.

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