Trade & import · documentary collections
Bank-mediated payment without the cost of LCs.
Your bank handles the documentary exchange and payment collection, but doesn't guarantee payment like an LC. Cheaper than LCs, less risk than open account. Common for trade with established partners in lower-risk jurisdictions.
What it is, when it fits
Plain English, with the trade-offs.
Documentary collections are a trade payment instrument where banks handle the documentary exchange and payment collection between buyer and seller, but neither bank guarantees payment. The exporter sends shipping documents to their bank, which forwards them to the importer's bank. The importer's bank releases the documents (and therefore custody of the goods) to the importer either against payment (D/P, documents against payment) or against acceptance of a future-dated payment obligation (D/A, documents against acceptance). If the importer doesn't pay, the documents stay with the bank and the goods stay in the bank's control until resolution. Cheaper than letters of credit (no payment guarantee fee), less risky than open account (banks control document release). Suits established trading relationships in lower-risk jurisdictions where formal LC overhead isn't justified but documentary control still matters. Pricing is typically a small per-transaction fee ($200 to $500) rather than percentage-of-amount.
Pen on a settlement document, two people deciding together.
Typical scenarios
Established import relationship
Why: 5-year supplier relationship, regular shipments, low default risk.
Outcome: D/P documentary collection per shipment; payment on document presentation.
Cost-conscious trading partner
Why: Supplier wants documentary control without LC cost.
Outcome: D/A documentary collection, 60-day acceptance, supplier discounts the bill of exchange.
Lower-value transactions
Why: Regular small shipments where LC overhead is disproportionate.
Outcome: Documentary collection at flat fee per shipment.
Ongoing trading pattern with reliable counterparty
Why: Established multi-year B2B trading.
Outcome: Documentary collection becomes the standard payment process.
Lenders for this product
Who we work with.
- NAB Trade
- CommBank Trade
- ANZ Trade
- Westpac Trade
- HSBC Australia
Lender accreditation varies; not every lender is available for every deal. We pick from the panel based on your specific situation.
How it works
From brief to settlement.
- 01
Trade pattern review
We review the trading relationship, jurisdiction, and order pattern to determine whether D/P or D/A fits.
- 02
Bank introduction
Documentary collections run through bank trade desks. We make the introduction to the right team.
- 03
Process setup
Most importers and exporters establish a standard documentary-collection process with their bank; subsequent shipments run through the same workflow.
- 04
Per-shipment execution
Documents flow through the banking system; we support resolution of any documentary discrepancies.
Indicative pricing & terms
Ranges, not promises.
Rate range
Per-transaction fee, typical $200 to $500
Loan size
Per-shipment, typical $10K to $1M
Term
D/P (sight) or D/A (60 to 180 day acceptance)
Security
Bank document control until payment or acceptance
Indicative only; specific pricing depends on lender, security, and your business profile.
Frequently asked
Honest answers, plain English.
Documentary collection vs letter of credit?
LCs guarantee payment by the importer's bank when documents conform. Documentary collections don't guarantee payment; the bank only controls document release. LCs cost more (typically 0.25% to 1% per quarter on amount) but shift payment risk to the bank. D/Cs cost less but leave the seller exposed if the buyer doesn't pay.
D/P vs D/A, which is which?
D/P (documents against payment): buyer pays the bank to receive the shipping documents. Cleanest for the seller. D/A (documents against acceptance): buyer accepts a future-dated bill of exchange (essentially a promissory note); documents released against the acceptance, payment due at the bill's maturity. Riskier for the seller because acceptance is not payment.
Risk allocation?
Documentary collections leave the seller carrying buyer credit risk. The bank doesn't guarantee anything; if the buyer doesn't pay, the seller's recourse is to the buyer directly. For weak-credit buyers or new relationships, an LC is usually safer despite the cost.
When to use documentary collections?
Established relationships, lower-risk jurisdictions, regular trading patterns, cost-sensitive transactions where LC overhead isn't justified. Default to LC for new relationships or higher-risk profiles.
Practical workflow?
Seller ships, presents documents to their bank with collection instructions. Seller's bank sends documents to buyer's bank. Buyer's bank notifies buyer; buyer pays (D/P) or accepts (D/A); documents released. Typical timeline 5 to 15 business days from shipment to document presentation.
Related products
If this isn't quite the fit.
Next step
Twenty minutes, no obligation.
Tell us the shape of the deal and the timing. We'll send a lender shortlist for documentary collections or, if it isn't the right fit, an honest signal of what is.