The Safest Payment Terms for Importing & Exporting (Avoid Scams!) | Harsh Dhawan
The Safest Payment Terms for Importing & Exporting (Avoid Scams!) | Harsh Dhawan A Telegraphic Transfer (TT) is an electronic method of transferring funds used commonly in international trade, including import and export businesses. Here's how it works:
1. Purpose in Import/Export:Importers use Telegraphic Transfers to pay suppliers (exporters) for goods or services.Exporters receive these payments as proof that the importer has settled their invoices, allowing the goods to be shipped.
2. Process:Initiation: The importer instructs their bank to transfer a specific amount of money to the exporter's bank account.Bank Processing: The bank debits the importer's account and sends the funds via an international payment network, such as SWIFT (Society for Worldwide Interbank Financial Telecommunication).Completion: The exporter's bank credits the funds to their account, completing the transaction.
3. Benefits:Speed: TT is relatively quick, often taking just a few days depending on the banks involved.Security: The process is secure, with banks involved ensuring that funds are transferred accurately and safely.Global Reach: TT can be used to transfer funds between almost any two countries in the world.
4. Costs:Fees: Banks charge fees for TT, which may include flat fees, percentage-based fees, or foreign exchange conversion charges.Exchange Rates: The transfer may involve currency conversion, and the rates applied can affect the total cost of the transaction.
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