Business Financial Instrument as A Payment Method Discussion – Description
What is a banker’s acceptance? How are they initiated? Why are they desirable for the exporter?
A banker’s acceptance guarantees payment to the exporter so that credit risk of the importer is not worrisome. It allows the importers to import goods without being turned down due to uncertainty about their credit standing. It is a revenue generator for the bank since a fee is received by the bank for this service.
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