International trade settlement
Parties in different countries, no matter is a human, unit, or between enterprise between governments, because commodity trade, service supply, financial resources, international lending and need through the bank to handle the foreign exchange receipt and payment business between the two countries, in settlement of creditor's rights debt relations between buyers and sellers, is called the international trade settlement.
L/C(信用证):
L/C (letter of credit, L/C for short) is a bank according to the request of the applicant and indicating, have a certain amount, and drawn to the beneficiary within a certain period of payment against the commitment of the shipping documents specified in the written documents; Or is that the Banks in the prescribed amount, date and documents under the condition that is ready to issue a guarantee of beneficiary's draft is underwritten by the applicants.
In international trade activities, both buyers and sellers may distrust, worried that after the advance payment by the buyer, the seller to ship the goods not in accordance with the contract requirements; The seller also worry on delivery or submit shipping documents after the buyer don't pay. Therefore need two Banks as buyers and sellers of the guarantor, on behalf of the collection/p, in bank credit instead of commercial credit. Banks in the event the tool is used by the l/c.
T/T(电汇):
T/T (Telegraphic Transfer) by T/T, is refers to the remitting bank shall apply the remitter, dispatched telex \ telex or SWIFT to branch or correspondent bank in another country (i.e., remittance) instruction for some a way of remittance amount to the payee.
T/T is a common way of trade settlement in international trade, has a certain risk.