Trade Services & Trade Finance

Documentary collections are usually chosen as a method of payment in international trade when mutual trust and reliability exist between the counterparties. They bear the following advantages:

• Lower fees and commissions compared to those collected under documentary letter of credits
• Higher level of security for the importer than assumed in advance payments
• Basis for short-term trade financing for the importer via acceptance of a draft drawn against the latter with deferred maturity, in case if the respective agreement has been reached between the counterparties

Transaction Mechanism

The bank receives or sends documents on a collection based on the collection instruction provided. Under a documentary collection a bank shall only transmit the received instructions. A bank assumes no liability or responsibility should the instructions they transmit not be handled.

Sending or receiving documents under a documentary collection, banks must determine that documents received appear to be as listed in the collection instruction and have no further obligation. Details of the transaction shall be reviewed by JSC Citibank for workability and compliance with regulatory requirements. The applicable international rules are:

Uniform Rules for Collections - ICC Publication 522