Cash-in-Advance: With cash-in-advance (Advance Payment) payment terms, the exporter can avoid credit risk because payment is received before the ownership of the goods is transferred. Wire transfers and credit cards are the most commonly used cash-in-advance options available to exporters.
- Exporter and Importer sign the purchase contract
- Importer transfers funds to pay Exporter
- Exporter ships the goods to the Importer
- Exporter forwards shipping documents to the Importer
- Importer then clears his goods from the port