Collection order, collection operations ... At first glance - it is difficult and incomprehensible. Let's try together to understand these and other terms. First you need to clearly understand who is involved in these operations, who produces them and why at all.
Now, first things first.
On the one hand, an enterprise (or organization) that sells certain goods (services), i.e. It is an exporter (creditor) and a bank through which all settlement transactions are performed. He, accordingly, is an exporting bank.
On the other hand, the buyer of these goods or services, i.e. the importer (debtor, payer) and the bank of the importer.
In order to receive payment from the debtor, the exporter submits a collection order to his bank to receive from the debtor (or through another bank) the previously agreed amount of money or confirmation of its payment at a specified time (acceptance).
A bank that has received a collection order from a client is required to present it to the debtor's bank. A collection order is provided within 10 calendar days from the date of its preparation.
Collection operations
Now we’ll take a closer look at the order of collection operation:
- the exporter and the importer sign an agreement in which, along with other conditions, agree through which banks they will make settlements;
- in accordance with this agreement, the exporter carries out the shipment of goods;
- the carrier submits the relevant supporting documents to the exporter;
- the exporter collects a package of documents that meets the conditions of collection, and together with the collection order submits it to his bank;
- the bank after checking the documents together with the order sends them to the importer's bank;
- Having received all these documents, the importer’s bank transfers them to the potential payer in order to collect the payment from him or to receive confirmation of acceptance, i.e. performs the actions specified in the collection order;
- the importer’s bank transfers the received funds to the exporter’s bank;
- after receiving them, the exporter's bank credits funds to his account.
This form of settlement is beneficial to all parties. To the exporter - because until the moment of payment or receipt of acceptance, his right to goods is protected by the bank.
To the importer - because on the basis of the package of accompanying documents he has full confidence that he pays for the goods already delivered.
And the bank, in turn, receives commission for the execution of collection.
But in the collection form of payments, there are also disadvantages. From the moment of shipment (delivery) to receipt of payment, quite a lot of time may pass, which negatively affects the turnover of the exporter's funds. He also does not have full confidence in the reliability of payment. The importer for the period of the workflow may be insolvent or refuse to pay at all.
Telegraphic collection or collection with a pre-received bank guarantee helps to avoid such unpleasant moments .
Processing a payment order
The importer draws up a payment order - this is a bank transfer order in which the payer instructs his bank to transfer from his account to the recipient's account a certain amount for the goods (services) received. It is compiled on a standard form of the established sample (f. No. 0401060).
The responsible person fills out the payment order , signed by the head who has the right to do so. The signature is certified by the seal of the payer.
A payment order is executed in four copies. Based on the first copy, funds are debited from the payer's account.
The second copy is intended for the bank (recipient). If both accounts are in the same bank, then it acts as a memorial order when funds are credited to the corresponding account.
The third copy is for the payee. The last, fourth copy, signed by a bank specialist, certifies with a seal that certifies the receipt of the payment order to the bank, and returns it to the client.
The bank is obliged to accept a payment order from the client, regardless of the availability of money in his account.