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Introduction to Documentary


Documentary Collection

The exporter asks Citibank to remit the title documents and the collecting
instructions to the importer’s bank. Citibank makes any necessary tracer as
representative of its customer and at maturity, collects and pays the funds to the
exporter. There is no obligation, for the bank, to pay to the exporter until funds
are received.

Sight collections, the exporter retains the ownership of the merchandise until it is paid

Citibank provides its structure and efficiency in handling commercial and financial
documents and acts as representative of the exporter for dealing with remittance of
documents and their collection

Consequently, the exporter can be sure that the documents representing the
ownership of the goods, will only be given to the importer against payment or

This product can be more flexible for the importer given that if he does not pay
on the exact date of maturity, usually there are no actions taken (because is a
product based on the confidence between the parties).

Nevertheless, the exporter can ask for the protest of the draft to be sure of the
eventual legal execution in case of non-payment. In a sight collection, the
exporter retains the ownership of the goods until the importer pays

Key principles

As the exporter exposes himself to a certain risk by producing/shipping the goods or providing another
service before receiving payment, we would only recommend documentary collections under following

 There needs to be a relationship of trust between the exporter and the importeur.

 There must be no doubt as to the importer’s willingness and ability to pay.

 The importing country must be politically, economically and legally stable.

 International payment transactions with the importing country must not be hampered or threatened by
currency controls or any other such restrictions.

How do collections work?

• Documents against payment

If You are exporting:

1. You dispatch goods, prepare documents, and complete collection order

(Definition: Document in which exporter instructs the collecting bank
on how the collection is to be carried out; what documents are
enclosed, what to do in case of problems, etc.)

2. You send documents and collection order to DHB Bank.

3. DHB Bank as the Collecting Bank, either makes presentation itself or

passes collection on to Presenting Bank.

4. Buyer pays bill of exchange at sight.

5. Presenting bank releases documents to buyer, who can now claim


In New Zealand ( ANZ)


Documents relating to the import of goods are forwarded through the banking
system from the overseas seller to the New Zealand buyer. Documents will be

released to the buyer against payment (for sight payment terms) or acceptance
(for deferred payment terms) of the Bill of Exchange, depending on the seller 抯

The purpose of the collection is to restrict the importers access to the goods until
they have either paid for them or given some legally binding promise to pay for