Order Payment Procedure refers to the agreed steps and methods for payment of goods between buyer and seller in foreign trade transactions, covering payment timing, instruments, milestones, and document requirements. Common methods include T/T (Telegraphic Transfer), L/C (Letter of Credit), D/P (Documents against Payment), D/A (Documents against Acceptance), etc. Usage scenario: After the contract is signed, the seller ships the goods and submits documents according to the procedure, and the buyer pays at the agreed milestones. Notes: It is necessary to clarify the payment ratio (e.g., 30% deposit + 70% balance), trigger conditions (e.g., payment upon seeing a copy of the bill of lading), bearing of bank charges, and the risk of document discrepancies. Unlike 'Payment Method,' the procedure emphasizes operational flow and time sequence, while method focuses on instrument selection. Compared with 'Payment Terms,' the procedure is more specific, while terms are more macro-level. In practice, vague expressions should be avoided; for example, 'cash on delivery' must specify whether it means arrival at port or arrival at warehouse.
📝 Examples
1. According to the contract, the order payment procedure is: the buyer first pays a 30% deposit, the seller provides a copy of the bill of lading after shipment, and the buyer pays the 70% balance upon seeing the copy. (Note: A typical T/T installment payment process.)
2. This order adopts a sight L/C payment procedure: the buyer opens an L/C, the seller submits a full set of documents after shipment, and the bank pays after checking the documents without discrepancy. (Note: Standard payment steps under a letter of credit.)
💡 Foreign Trade Tips
Foreign trade terms are the foundation of international business communication
Trade practices may vary slightly by country; pay attention when using them
When using terms in contracts, specify the applicable version (e.g., Incoterms 2020)
For unfamiliar terms, use GlobalSync's multilingual email helper to confirm with your partner