Difference between export bill collection and export bill discounting.

1. In simple terms, export bill collection means sending of export bills to overseas
buyer through his bank to collect payment under export bills.
2. Where in export bill discounting, the exporter get amount from his authorized bank
while submitting export documents.
3. Once after completion of necessary export procedures and formalities the exporter
prepares necessary documents to send to his overseas buyer to take delivery of
cargo.
4. This documents includes Commercial invoice, Packing list, certificate of origin, Bill
of lading or Airway bill, bill of exchange, quality certificate, and other documents
specifically mentioned by the buyer at the time of placing purchase order.
5. Once after preparing such export documents, the exporter submits them with his
authorized bank to send to his overseas buyer.
6. If the exporter has a facility with his bank to discount export bills, he requests bank
to discount the said export bills.
7. Bank after verifying and confirming on such export documents, credits amount of
invoice under the said shipment to his account.
8. Once after receiving amount from overseas buyer , the bank adjust the said amount
against the discounted amount after charging necessary bank interest till the date of
export proceeds.
9. If exporter need to send the export bill for collection, he advise his bank to send the
documents for collection of payment from overseas buyer.
10. Once after paying export invoice amount by overseas buyer to exporters bank
through overseas buyers bank, the exporters bank credits the said amount received
with exporters account.


Procedures for negotiation of export documents

1. Once your goods moved out of your factory, the Customs House Agents appointed
by you complete customs formalities on behalf of you and delivers you necessary
export shipping documents.
2. Once customs formalities completed and obtained let export order shipping bill,
you hand over cargo to shipping line to carry your goods Procedures for negotiation
of export documents to final destination at buyers place.
3. Once after handing over cargo to shipping line, Bill of Lading is issued.

What are the precautions to be taken while submitting documents for negotiation
with bank?

1. While negotiating documents, you submit all required documents as per letter of
credit terms and conditions to bank to send to your overseas buyer though LC
opening bank.
2. When shipment is under Letter of Credit, documentation is a crucial part as the
opening bank debits you against any discrepancy found on documents.
3. So once you received Letter of Credit, make a copy of the same and read carefully
twice.
4. Mark each and every point where ever necessary.
5. Whether any international inspection required, clean on board bill of lading, factory
inspection certificate, certificate of origin, legalized documents, consulate
attestation, SGS,BVQI inspection, Phyto sanitary certificate, chemical analysis
certificate, shipped on board certificate, freight certificate, etc.etc.
6. List out the documents required to submit while negotiating bills.
7. Go through each document minimum twice, whether each document is as per LC
requirements.
8. Make sure, all documents are there as per LC terms and not found any discrepancy
in each of document.
9. This is very important while submitting documents with bank to send to overseas
buyer through buyers bank.
10. Once after receipt of export documents, your bank arranges to negotiate bill as per
Letter of credit terms and conditions after proper verification of each and every
clause.
11. If your export order is in US Dollar currency, you can either convert the amount in
your currency or you can open a dollar account and transfer the amount
accordingly.