Under a documentary collection, the exporter commissions his bank to collect a specified amount from the importer as payment for goods delivered or services rendered and against presentation of shipping or other specified documents. Payment may be made by sight draft or on maturity of an accepted draft or letter of undertaking.

As such, UBS acts as the agent and intermediary between the exporter and the importer. With our extensive international network of correspondent banks and our team of experts behind you, you know you're in safe hands.

• Client = exporter/seller:Submits the documents to his bank along with a corresponding collection order.

• Remitting bank = client's bank:The bank entrusted by the client with handling the collection; it forwards the documents to the presenting bank in accordance with the provisions of the collection order.

• Presenting bank = importer's bank:The bank making the actual collection or procuring the acceptance from the drawee.

• Drawee = importer/buyer:The party to whom the documents are presented.

As the exporter makes an advance commitment in terms of the production/shipment of the goods or provides another service, we would only recommend documentary collection in the following circumstances:

• There needs to be a solid relationship of trust between the importer and the exporter.

• There must no doubt about the importer's willingness and ability to pay.

• The importing country must be politically, economically and legally stable.
  
  There should be no import restrictions, such as exchange controls, in the importing country. All the necessary import licences need to have been obtained for the goods to be imported freely.

By instructing the presenting bank to surrender the documents only against payment of its commissions and charges. This condition is, however, only effective if the buyer can only gain possession of the goods provided he has the documents.