Telegraphic Transfer (T/T) is a remittance method in which the remitter entrusts the bank to use telecommunication tools such as tested cable and telex to instruct a bank in the exporting place to act as the remitting bank and pay a certain amount of money to the beneficiary.
The telegraphic transfer settlement method is quick and safe, which is conducive to the full utilization of funds, but the cost is higher than that of letter of credit and bill of exchange. In actual cross-border e-commerce imports and exports, T/T is divided into prepaid, spot and forward. The most commonly used ones are 30% prepaid and 70% spot. There are three ways to pay by T/T.
①Pre-T/T: collect payment first, then ship.
Payment before shipment, that is, prepayment of the goods, is more risky for the buyer. ②Post-T/T: Ship first, collect payment later
Payment after all shipments are made, which is more risky for the seller. ③Deposit first, then balance.
In foreign trade business, familiar customers generally use T/T payment, often prepaying part of the payment before shipment, and the balance is paid after shipment. Under normal circumstances, telegraphic transfers often use 30% of the payment as a deposit, and the remaining 70% is paid by paying the copy of the bill of lading. The larger the proportion of the deposit, the lower the risk of the exporter. Note: The exporter’s bank collection account must contain the following information:
· Beneficiary;
· Beneficiary Account# ;
· Bank Name; · Bank Address;
· SWIFT code.
SWIFT (Society for Worldwide International Financial Telecommunications) is an international cooperation organization among international banks. It was established in 1973, and most banks in most countries around the world currently use the SWIFT system. The use of the SWIFT system provides a safe, reliable, fast, standardized and automated communication service for bank settlements, thereby greatly improving the settlement speed of banks. So, how to check the SWIFT Code? To check the SWIFT Code of a bank, you can call directly for consultation, or it is more convenient to check it online (www.swift.com).