In international trade, because the two parties of the transaction are in different regions and countries, the difficulty of trade settlement is increasing. These include international trade settlement methods such as letters of credit, remittance and collection, and bank guarantee letters. In order to ensure that the trade between the two parties can be successfully completed, the most basic premise is to understand the international trade settlement method. So what are the settlement methods for L / C, D / P, and D / A? What's the difference? Letter of Credit (L / C) The letter of credit is a payment method provided by the bank to the exporter to provide payment guarantee. When the credit payment method is adopted, bank payment is conditional on the exporter submitting the documents stipulated in the credit, so the credits used in international trade settlement are basically documentary credits. Collection Collection is a settlement method in which a creditor issues a draft to entrust a bank to collect money from the debtor. In international trade, the creditor is the exporter, and the debtor is the importer. The exporter ships the goods in accordance with the trade or business contract generating claims, and the importer obtains the goods and incurs debts. Documentary collection refers to the collection of other documents attached to the bill of exchange, and is also a common settlement method in trade. Documentary collections are divided into payment and acceptance documents according to their method of payment. 1. Documents against Payment (D / P) Documents against Payment means that payment can be placed to the payer, and the payer can only obtain the receipt to pick up the goods after paying the payment. In other words, we prepare our negotiating documents after delivery and deliver the order to the customer's bank through our bank. The customer bank prompts that the customer's document has arrived, and the customer pays the bank after the payment. 2. The Documents against Acceptance(D / A) The Documents against Acceptanceis the bill payer's commitment to pay the due date, and the collecting bank may release the bill to the payer. That is to say, to submit the bill to the customer bank through our bank, the difference is that the customer only needs to accept our bill, and then take the original bill, and pay after the due date. Remittance Remittance settlement is the simplest method of settlement. The seller ships the loan directly to the buyer, and the buyer pays the seller through the bank. The bank does not process bills or documents. Remittances are divided into wire transfers, letter transfers, and ticket transfers according to the method of fund transfer. (1) Telegraphic Transfer (T / T), that is, the transfer of remittance funds and remittance instructions are sent to the remittance bank by telecommunications. The wire transfer time is very short, and the payee can receive the money quickly, which is more suitable for the goods that are in urgent need of purchase. (2) Mail Transfer (M / T). That is, the remittance order instruction issued by letter, which is slower and more suitable for transactions with small amounts. It is not easy for exporters to accept letter transfers for large transactions. (3) Demand Draft (D / D). The exchange instruction and fund transfer are completed by bank draft. At present, in the international bank drafts, even if the drafter requests the drafts, the remittance bank generally needs to use the escort to confirm it to prevent counterfeiting.