How to Import Solar Panels From China?
How to Import Solar Panels from China?, China is making it sensible, inexpensive and the most encouraging sources of renewable energy are the power from sun termed as solar power. The industry has grown with incredible speed in the last period while worldwide solar power capacity is still limited.
We look at the simple technical terms of solar photovoltaic panels and on what issues you shall select a Chinese solar panel producer. We also introduce you to guidelines, anti-dumping obligations in major markets and trade shows covering solar goods.
Chinese producers are familiar to produce goods according to the purchase conditions. Though, the solar industry is a little different in the sense that goods customization is normally not necessary. Solar panel dealers produce goods according to a pre-determined set of goods terms.
That being said, not all dealers making solar panels of the same quality. Here below a list of the most basic goods terms, we need to keep the path of:
- On-web or off-web
- Lifetime (20 – 25 years)
- Substantial – Polycrystalline or Monocrystalline
- Salt defense – for connections in seaside regions)
- Obverse (State bus bars and coating)
- Rear (State bus bars and rear substantial)
- Cell proficiency (e.g. 17.2%)
- Quantity of cells: 60 cells per panel (6 x 10)
- Cell measurements
- Solar panel measurements
- Solar panel mas
- Insignificant power
- Extreme voltage
- Extreme current
- Working temperature variety
- Extreme load capacity
- Cable and connector goods/models (stand-alone constituents shall also be compliant with goods care guidelines)
- Cable dimension
- Output patience
- Frame substantial
- Fill issue
The finishing goods description shall be provided by the dealer. Though, if we have exact performance necessities, you may originate by recruiting a short list of basic quality terms and let the dealer suggest matching goods.
Most Chinese producers offer a 25-year warranty assurance. Though, efficiency (input compared to the output) losses are part of the calculation. Many dealers advertise that their solar panels maintain 90 percent to 95 percent output in the first 10 years and from 80 percent to 85 percent output during the outstanding 15 years. But insufficient if any Chinese dealers can support these assertions with historic enactment data.
There are two collections of modules: panel modules such as connectors, trackers and mounting and power modules, including inverters, DC isolation switches and meters.
We need to keep in that stand-alone module shall also be acquiescent with electrical safety guidelines in our nation or market. Though maximum Chinese solar panel dealers proposal all system modules we may require, never take for granted that these modules are compliant with the guidelines in our nation. Many dealers have no experience that those modules used in Chinese solar installations do not match with guidelines in other markets.
China solar panels producers
The world’s largest producer and exporter of solar panels are China. The industry is controlled by a handful of the main players. One of them is Yingli Solar, a company we might recognize by now if we have been viewing the World cup lately they are the main sponsor.
However, the solar panel producers are not allocated to small to medium-sized importers at least not any more than rank in China’s top 10. But, the industry is more satisfactory than these companies. There are about 3000-panel dealers on Ali Baba alone. Moreover the greater part i.e. nearby 91% is situated in Zhejiang, Jiangsu and Guangdong area.
Though producing solar panels is not rocket science, it’s far more difficult than accumulating wrist watches. Before finalizing the dealer to source solar panels for clients, following features should be considered:
Quality Management Scheme
A Quality Management Scheme (QMS) is a set of operational ways, during the numerous goods ion phases laid in place to display the quality of goods. In short, this includes checking incoming materials and components from subcontractors, testing purposes during the goods ion and final testing before the assembled goods are transported. The motive is to identify quality concerns while there still time to fix them.
There are numerous recognized that in use today Quality Management Schemes, the most communal being ISO9001. When it comes to most purchased goods, we don’t consider a QMS to be a great benefit, but not serious. Though, electrical goods are very different. You can’t “see” or “feel” electrical quality issues. If the goods ion is not closely checked, one faulty batch IC circuits or chips, from a subcontractor, can destruct the entire goods ion.
Agreement with the United States and European Goods Guidelines
All Chinese producers are mainly focussing on western markets, and therefore many American’s and Europeans had an opinion of a safe agreement with the proper goods guidelines in these countries. That could not be more wrong, particularly in the solar panel industry.
Firstly, China itself is a huge market for the solar panel. The major markets in the industry are South America, Africa, The Middle East and South East Asia. Some dealers are geared towards these markets, rather than the United States and the European Union.
Need help discovering solar panel dealers compliant with guidelines in our nation? When we order on Chinaimportal.com for a Starting Package right here, we confirm which guidelines apply to the goods, and source solar panel producers capable to show previous agreement.
So after being asked, agreement with the European Union and United State goods value is not inappropriate for African, Asian and Latin American importers. A dealer that can show agreement with values such as CE and RoHS, tend to be more trustworthy in terms of goods quality and management consistency. These are issues that matter to all importers.
Importers need to be sure that the purchase of solar goods that it should not be made other than a producer. Purchasing solar panels from disorganized dealers, selling a little bit of everything, is not a consistent buying policy. It’s important that the scope of dealers in this industry is above from the normal, meaning that there are plenty of impartially big producers to select from.
It’s a fast affecting industry. Keeping track of the logistics and develop new goods needs capital and manpower. But this is not enough. From time to time, during goods ion, things go wrong. When this happens, the supplier should have sufficient money to purchase new components and restart goods ion. That might sound apparent, but many importers truly misjudge the scale of most Chinese producers.
Many times, the Chinese solar power industry has been caught in the crossfire from main economies. Here below a brief summary of the current condition in the United States, European Union, and India.
In 2012, the United States International Trade Commission imposed anti-dumping regulations on solar panels produced in China. Earlier, the Anti-Dumping obligations did not apply to solar panels made with cells produced outside of China. Though, starting in June 2014, the Anti-Dumping obligations also cover such goods. The prices differ between different producers fluctuating from 18.56 percent to 35.21 percent.
The European Union started a study in late 2012. In the end, Anti-Dumping obligations were not charged on Chinese made solar panels. In its place, the European Union and China decided to set a minimum price level for solar panels. Consequently, European importers must not worry about Anti-Dumping obligations on imported solar panels at least not yet.
In India, Anti-dumping obligations are charged on import of solar panels from China, Malaysia, and the United States. The prices on Chinese made solar panels varied from 100 percent to 110 percent.
Solar Panel Presentations in China
Go to a Trade fair is a price efficient method to meet industry-leading dealers and compare goods and values. If we mean to import solar panels from China, then these are the Skill fairs for us:
Region Fair Phase-1
- The Region Fair is largest trade fair in China and is located in Guangzhou, Guangdong. It’s held every year in April and October.
- Solar Cells and Modules
- Electrical modules: Storage Battery, Controller, Transverter, Recording Instrument, Inverter, Monitor, Bracket System, Tracking System, Installation System, Sun Cable, Measuring Instrument
- Photovoltaic Goods, Systems, Raw Materials & Equipment
- Solar-thermal Goods, Solar Water Heaters, Heat Pump, Thermal Collectors, Solar Air Conditioners.
SNEC PV Power Expo
SNEC is a main conference and dealer exhibition held annually in Shanghai. It has been on for the previous 8 years and the next exhibition is held in May 2015.
Hong Kong Electronics Fair (Spring Version)
This fair is held annually in Hong Kong, by HKTDC Hong Kong Trade and Development Council. At the HK Electronics Fair, we will find dealers manufacturing and trading many solar goods, such as:
- Solar Cells
- Solar Chargers
- Solar Heaters
- Solar Lamps
- Solar PV (Photovoltaic)
- Solar PV Batteries
- Other Solar Goods
SIPE Solar Fair
As its name suggests, (SIPE SOLAR EXPO) China International Solar Power Generation Goods Exposition solely concentrations on Solar Power goods. It’s held yearly in Nanjing, the capital of Jiangsu area.
Production of China Solar Panels
China is the primary supplier of solar panels across the globe. The components utilized in manufacturing these panels such as polysilicon are very abundant in China. As a result, Silicon tetrachloride, costs as high as $84,500 per ton. But Chinese suppliers offer it at around $21,000-$56,000 per ton.
GCL-Poly is the largest polysilicon provider which creates 65,000 tons yearly. The major producers involving photovoltaic cells (PV) in 2011 are also from China – Suntech, JA Solar, Trina, as well as Yingli, producing 2,400MW, 2,100MW, 1,900MW, and 1,700MW (additionally), respectively. It is also known that China was the finest and major distributor of solar modules in 2011 Global Primary Ten Solar Module with corporations, inclusive of Suntech, LDK, Canadian Solar powered, Trina, Yingli, Hanwha Solar One, Jinko Solar and Sunneeg.
An importer/buyer should analyze the succeeding regards with, tariffs as well as requirements before beginning the operation of sourcing solar panels from China:
Tax Tariff – It is the duty charged by the Chinese government for importing solar panels. Codes affiliated discover tariffs are found in the Harmonized Commodity Coding System.
Customs Duty– It is the amount paid depending on the Tariffs imposed on certain items. This can be calculated based on the solar panel value, overall quantity, tariff classifications, and also, VAT (Value-Added Tax).
Certificates – It includes the origin of the country certificate, description of goods ( about the quality of solar powered panels and corresponding tariff category), weight, Bill of Lading, insurance data, packing list, copies involving the invoice, as well as other special documentation that required from the importer.
The Steps of “How to Import Solar Panels from China?”
Step1. Establish a Partnership with Supplier
Initiate and establish contact with Chinese solar panel producers/suppliers. Inform them about your company. The majority producers in China already have importing partners so it’s better to select renowned corporations. For supplier qualification schemes importer should determine how long they have been in the manufacturing business and additionally the number trade shows they have attended.
Step2. Mutual Agreements
An importer should examine the quality of the items and discuss all the provisions concerning shipping and pricing. The importer must try to place a trial order so that it will confirm their collaterals, packaging, insurance terms, and other guidelines.
Step3. Learn Trade Terms
The most frequently used terms are FOB (Free on Board meaning the cost for the products include freight cost to the destination country) and CIF (Cost, Insurance, and Freight meaning the price of the products include insurance as well as freight costs towards the destination). Must verify all details with Chinese distributor or supplier so you can execute risk assessment and additionally confirm approximate landing costs. Also, seek assistance from an Import Management Company and a freight forwarder for a detailed cost breakdown and for other documentation.
Step4. Payment schemes and negotiation
Most frequently, suppliers will collect a fraction of the total cost during the ordering stage and the other half when the merchandise is shipped. Importers can further negotiate these payment schemes.
Step5. Meet the Regulatory Requirements
Importers are required to verify his/her shipment meets all the regulatory requirements. The importer should at least need to be compliant with basic regulations.
Step6. Opt for a Reputable Customs Broker/Agent and Forwarder
Every country has local trade organization/association having a list of trustworthy forwarders. So it’s better to import through such agents as they can be easily contacted in case of any need or if there is any doubt regarding quality or quantity of products, payment, documentation/certification formalities, etc. of imported goods.
Step7. Place a Trial Order/ Order a sample
This trial order can ensure everything about the importer’s capability for the bulk importation of the solar panels. In the trial purchase order, it is needed to write specifications for all goods you are importing i.e. solar panel specifications, packaging requirements, as well as trade information.
Step8. Hire a Product Inspector
The importer needs to hire a quality assurance agents to check and to get ensure about the solar powered panels specifications during the fabrication stage. The importer can also ask his/her individual QA personnel if it is possible to examine the assembly area as well.
Step9. Transportation and Customs Clearance process
The transportation will be handled by your chosen forwarder and the customs broker will manage with customs certificate of the imported solar panel.
Step10. Keep the Records
As soon as an importer receives the solar panels, make sure to keep the records pertaining to the transactions.
Step11. Check the Authenticity of Your Products
If the importer purchases the solar powered panels through any reseller in China, the importer needs to verify the authenticity of their items as well as of their manufacturing units.
List of China Solar Panels Producers/Manufacturers
- Hanwha Solar
- Canadian Solar
- LDK Solar
- Singyes Solar
- Yingli Green Energy
- Asia Silicon
- BYD Solar
- Trina Solar
- Jinko Solar
- Trony Solar
- GCL Poly
Requirements for solar panels
In order to import solar panels from China, Antidumping and countervailing duties are need to be considered. If the importer of any country imports goods that do not contain Chinese solar cells are required to certify that the imported solar panels do not contain Chinese solar cells and to provide this certification at the request of U.S. Customs and Border Protection (CBP). But if the importer does not provide this certification at the request of CBP, the U.S. Department of Commerce has instructed CBP to collect antidumping and countervailing duties on the corresponding imports of solar panels. Importers buying solar panels from China are also required to maintain a certification from the supplier. If the importer does not provide both the importer and exporter certification at the request of CBP, the U.S. Department of Commerce has allowed CBP to impose both the duties i.e. anti-dumping and countervailing duties on the imports of solar panels. These certifications should not be provided as part of the entry document unless specifically requested by CBP.
7 Documents an Importer Must Ask from a Chinese Supplier
It is necessary to ask your supplier in China for key registration documents as well as certification to protect your business.
There are certain common documents that any supplier in China should be willing and able to provide importer. The importer should always request a copy of essential documents that may be required in different situations.
The business license is the must document that should be viewed in every business deal with a Chinese company. Requesting a copy of the business license is a very common, legitimate request, so any resistance to it from a Chinese supplier can be a useful early warning sign. Once you’ve got a copy of the business license, you’ll need to verify it.
2-Bank Account Certificate
Bank account certificate proves that Chinese suppliers are the genuine holder of the business bank account as shown on the certificate. It is a useful way to avoid some of the more blatant kinds of scams and fraud. If an importer makes a payment to the verified bank account shown on a company’s bank account certificate, then it’s a proof that the payment is actually going to that company and that it’s not a personal account from which the money might “disappear”.
3-Tax Registration Certificate
A Chinese company’s tax license is also known as its tax registration certificate. Tax registration takes place only when a company has successfully acquired a business license, and covers many of the same details as a business license, including:
Operation scale and other details.
4-ISO 9001 Certificate
An ISO 9001 certification demonstrates that a supplier in China has implemented adequate systems for:
Measurement, analysis, and improvement
Requesting a copy of a Chinese supplier’s ISO 9001 certificate is another standard step to take before placing any orders. Just viewing the certificate is not enough, an importer needs to ensure that the certificates are ISO 9001 granted or not.
5-ISO 14001 Certificates
ISO 14001 certificates as being an ISO 9001 is for resource management, and by extension, for environmental concerns. It certifies a company’s resource management system just like ISO 9001 certifies their quality management systems. ISO 14001 refers to environmental concerns, i.e. about reducing waste and improving efficiency. However, ISO 14001 is not only about environmental friendliness; it’s about efficient use of resources also.
6-Product Test Report
The importer must ask for a product test report from a supplier in China at every stage just to confirm that the goods are up to the required standard.
If you’re importing goods manufactured in China, there’s a good chance you will need certification showing that the products meet relevant standards in your country. As solar panels require this kind of certification. Product tests have to be carried out on the goods before they are shipped, and certification will be required by importer’s country’s customs officials.
A supplier’s product brochure isn’t too difficult to understand, but there can be issues need to be aware of. It’s not uncommon for any suppliers to include products in their brochures that they don’t produce themselves but can act as a trading company for and source from other suppliers. These sorts of issues can be avoided through factory visits and proper auditing of the company.
What to think about “How to Import Solar Panels from China?”
Before importing any product it is necessary that the product is in compliance with all product regulations. As mentioned, far from all suppliers can manufacture products that comply with the strict regulations in the India, the European Union, and other developed Asian markets.
In addition, lab testing costs thousands of dollars per piece, when it comes to efficiency and capability of products.
What is the MOQ?
MOQ depends on the type of product, but normally around 50 to 100 pcs, per product. While many wholesalers may offer MOQs as low as 15 to 20 pcs per product, such products are non-compliant and even be dangerous.
Solar Electrical Appliance Regulations
An importer must be aware of all the regulations before he searches about how to import solar panels from China.
Several manufacturers have begun embedding electronics into PV modules. This enables individually performing maximum power point tracking (MPPT) for each module. Such electronics can also compensate for shading effects. Therefore, these solar panels fall under the other regulations. Depending on the product and market, the following may be required:
- Country of Origin Label
- CE Mark
- WEEE Mark
- CA Prop 65
Testing of Products
The purpose of testing is to verify whether a product is compliant with other directives, acts, or safety standards. As there are different types of product regulations, so different types of testing:
- Substances testing
- Electrical safety testing
- Mechanical and physical testing
A full certification of a product is the best and safest way to import. It is necessary to find a manufacturer who has a fully certified product. Full certification is quite expensive and therefore not often found. In spite of it some markets, especially from retailers demand full certification.
Labeling & Marking
The following markings must be on the final packaging of the product and are sold to the importer where applicable:
WEEE, FCC, CE, GS, Made in China, Recycle symbol
Suppliers must put all labels and markings of the product on the packaging as well as in the Instruction Manual (Electronic products usually have instruction manuals).
At times, some products are not certified because of low quantities or the product is so cheap that the certification cost doesn’t justify certifying it. For this purpose, the importer can ask the supplier for a self-declaration which may be accepted by authorities.
And the importer should at least need to be compliant with basic requirements like raw material being certified or tested according to regulations.
Value of Imports from China
China has been experiencing tremendous growth in GDP, manufacturing, exports, and other economic sectors. More than ever, importing products from China can produce both immediate and long-term profit.
Benefits of Import China Solar Panels
As long as, importer follows customs regulations, can often buy bulk goods from China cheaper and with lower taxes. This is because importer is essentially acting as an independent retailer, buying products directly from the manufacturer and importing them to his own country. Moreover, China requires no special licenses or permits to purchase goods, as long as importer follow national and international trade regulations are free to import nearly anything in almost any quantity.
Importing from China allows importers to have direct control over their business’s distribution model. This provides importer the flexibility that the major retailer does not have.
Because China’s manufacturing sector has experienced a prolonged, dramatic boom, directly importing from China can prove to be an effective business solution. If importer, research and plan his/her business around hot markets, the potential for profit can be very significant.
Import Duties and Taxes:
At the very moment, you think of how to import solar panels from China, the next step is to find about import duties and taxes levied on the import of that particular product.
HSN Code: – In India, solar panels are mostly imported under HS Code 85414011, 85414019, 70071900
- The basic duty which is a typical tax that applied to all goods, but an import of solar panel is nil.
- CVD additional duty: It is levied on imported goods in lieu of excise duty levied on good/items manufactured in India, but it is 12.5% of the solar panel.
- Central Excise Education Cess: A tax which is designed to fund education healthcare initiatives. It is 3%.
- Custom Education Cess: On import of solar panels the rate is 3%.
- Special CVD: It is applicable on all imported items in India and levied at the rate of 4% on import of solar panel.
- GST: GST on Solar Cells Whether Or Not Assembled in Modules or Panels is 18% (85414011, 85414019) and 28% in 70071900.
The Shipping cost is a substantial percentage of the importer’s total product cost, so it’s important to keep them as low as possible. Below are the four most considerable shipping methods anyone can use to import goods from China:
Regular Post: This is normal, regular China Post which takes approximately 6 weeks to arrive. No online tracking is provided and can be used for parcels under 3kg. Importer generally uses the regular post for samples and again only if time is not that important and can wait a few weeks for a package to arrive. It is not the most reliable system.
Courier: Shipping with a courier company is the suitable method for most importers starting out, if it involves small, lightweight items. With courier companies such as TNT, DHL, UPS or FedEx importer has to pay a premium price for each kilo and can get fast delivery times and an online tracking facility. These days most courier shipments take normally 3-5 business days.
Air Freight: This method lies between courier shipping and sea freight. Shipping times may vary from company to company, but in general, it takes 5 to 10 days which is not bad! Air Freight is comparatively less expensive with courier companies, but it involves extra work when the goods arrive in the importer’s destination country. Air Freight importer usually has to handle documentation and customs clearance on their own (unlike with courier companies). But the importer can always outsource these tasks to a freight forwarding company at an additional cost.
Sea Freight: This is the popular shipping method used by big companies/firms to import goods from China. The cost per kilo is very low, but the downside is their lengthy delivery time. Depending on where the importer is located it will be in the vicinity of 30 to 40 days.
The documentation, customs clearance, and delivery of goods from the port to home should be properly taken care off by the importer in sea freight. So it’s always advisable to use a freight forwarding company that will take care of all the procedures and deliver goods right to the door.
In Sea Freight it’s very essential to first calculate all the EXTRA COSTS involved in this type of transportation. The supplier’s part will get over with the FOB price, which means that his part of loading the goods onto the ship is finished. But that’s not the end. Once your shipment arrives at the port there are other kinds of extra charges, such as: Unloading charge; Port fees; docking fees; Storage fees; Clearance fees, etc. In general, for bulky items, sea freight is the better option.
when and where the consignment shall be transferred between the supplier and the importer are referred to as international standard codes in terms of shipping.
For example, FOB (Free on Board) includes transportation from the factory, to the port of destination/office/warehouse. FOB includes all export procedures, which are required to ensure that the cargo can be legally exported. But from the port of destination, the importer must arrange to forward the goods to final destination. On the other hand, the importer can book DAP (Delivered at Place), which includes shipping from the factory in China, to a specified address overseas, such as an importer’s warehouse.
FCL and LCL Shipping
If the importer buys by the container load, then FCL (Full Container Load) shipping is a good choice. FCL is also the cost-effective freight method if counted by cost per volumetric unit and weight unit.
However, many small volume buyers don’t buy full container loads. As already said, Air freight is then a viable solution for them. However, some shipments are stuck in the twilight zone between air freight and FCL cost viability.
Then the solution spells LCL, or Less (than) Container Load which is generally shared container freight. Cargo from multiple buyers gets stored in the same container.
Insurance is included, by default, when an importer selects the incoterm CIF, standing for Cost Freight (and) Insurance.
If importer orders according to DAT (Delivered at Terminal) or DAP (Delivered at Place) then, the importer has to inform his shipping company that the cargo must be insured. Shipping insurance is cheap and rarely costs more than US$50 to US$100. Shipping insurance covers the value of the cargo, in case of transportation damage. It will not cover lost sales or product development costs.
The cargo must be sufficiently and satisfactorily protected, from the dusty factory floor to a damp warehouse, and finally stacked in a container for up to a month.
A lot can happen in this time, an importer needs to be sure that his export packaging is up to the mark or not. To ensure, cargo is protected during transportation, the importer can use the following checklist:
- Inner cartons layers – 5
- Outer cartons layers – 5
- Plastic wrapping (on Outer carton)
- Pallets (ISPM 15 EU Standard)
- Freight remark (Printed on outer carton)
The importer must provide the supplier with explicit and clear export packaging specifications and do not leave anything to their interpretation.
But there is more to export packaging. There are various export packaging regulations to take into consideration, such as ISPM 15 and Lithium battery restrictions.
Before shipping from China, the importer has to confirm which shipping regulations apply in his/her country, and to the product.
Arrange your cargo transport
There are other costs related to shipping goods are container fees, packaging, terminal handling, and broker fees. And to get a complete picture of shipping costs, each of these prices should be taken into account. After the satisfaction of an importer with the freight quote, contact details to the supplier is being provided. They will take goods from there and also make your transportation quick and safe.
Track your cargo: Shipping goods internationally takes time. So, during that time, the importer must check his commercial invoice, packing list, the bill of lading, and other freight documents. If then a problem arises then he should know the steps from which the goods go through when being cleared by customs of his country.
Obtain your shipment: When the goods arrive, the importer needs to make arrangements for customs clearance agents to clear the goods and services through custom. And if everything goes, then, then it’s right to pick up your shipment.
CUSTOM CLEARANCE PROCEDURES IN INDIA
All imported goods in India have to pass through the customs clearance after they cross the Indian border. The imported goods are examined, assessed, evaluated, and then allowed to be taken out of customs charge for use by the importer. The procedures for Customs clearance of goods imported in India are as follows:
Import Manifest: As per the section 30 of the Customs Act, 1962, the person, carrying imported goods should hand over, within 24 hours of the arrival of the conveyance, an import manifest to the customs. The import manifest upholds the complete list of all goods and products that had been carried on board, and those to be carried to the subsequent ports.
Entry in the Import Department of Customs House: On receipt of information regarding the arrival of the goods, the importers or customs agents/broker information to make an entry by filing a Bill of Entry, in the Imports Department of Customs House.
Clearance of Goods: After payment of duty, the importer must give the duplicate copy of Bill of Entry on which order for examination of the goods is given by Customs and get the goods examined. If the description of goods is found to be correct, clearance of goods is allowed.
Warehousing the Goods: The imported goods can be warehoused at the port of shipment, without the payment of duty, but by presenting a “Bill of Entry for Warehousing”. The warehoused goods can be cleared in one or more installments.
Foreign Exchange: Once the importer is allowed to remit foreign exchange out of the country, he has an obligation to import the permitted goods. If the goods of lesser values are imported then it would lead to leakage of foreign exchange.
Letter of credit: It is the most common method of payment in International trade. Under this, importer’s bank guarantees to the supplier’s bank that the bank will pay given the amount in the agreement, once the supplier meets the terms and conditions of the letter of credit.
Bank Drafts and Cheques: Bank drafts and cheques are the most popular methods of remittances. A bank draft is a payment order issued by an importer’s bank on its own branch. The bank draft then is handed over to the buyer who sends it to the beneficiary. The beneficiary obtains payment on presentation to the bank on which the bank draft is drawn.
Bill of Exchange: A bill of exchange is an order made by the exporter and sent to the importer through a commercial bank. Bill of exchange is an important method of payment.
Telegraphic Transfer (TT) This is a method of foreign payments in which importer through telegraphic transfer the funds to the exporter in foreign countries. The money is deposited with the commercial banks and the banker sends a telegram to the foreign branch to make certain payments to the exporter, on that very date. After that, the foreign branch makes the required payments in foreign exchange currency to the exporter. This type of transfer is the fastest and no risk involved method of transmitting funds.