Guide
Exporters ask how to get paid safely. Importers ask how to avoid paying for goods they never receive. Both are asking about payment security.
Last checked: November 2026
Please note: Rules, duty rates and procedures change. Check the position in force on the date of your shipment. We are consultants, not a law firm.
The short answer
- Choose the payment method to match the risk and the relationship.
- If you use a Letter of Credit, read it the day you receive it.
- Keep your shipping documents consistent with each other.
- Insure the goods in transit.
The usual options, from safest for the seller to safest for the buyer
- Advance payment
- Letter of Credit (L/C)
- Documents against payment
- Open account
Checking a Letter of Credit
- The bank pays only against documents that match the L/C terms exactly. Small mismatches in a name, date or description can lead to a refusal.
- Read the L/C the day you receive it. Ask for changes before you ship, not after.
- Check the shipment date, port names, goods description and required documents.
- Keep the invoice, packing list, transport document and insurance certificate consistent with each other.
Open-account terms
If you sell on credit, consider credit checks on the buyer and export credit insurance, so that a buyer's failure to pay does not become your loss.
Insure the goods
Marine cargo insurance covers loss and damage in transit. A claim goes smoothly only if the papers are in order. See our marine cargo insurance page.
Common questions
Why do banks refuse Letter of Credit documents?
The bank pays only against documents that match the L/C terms exactly. Common reasons are a mismatch in names, amounts, dates or goods description, a missing document, or presenting the documents late.
Is open account safe for a first order?
Usually not. Until you know the buyer, an advance payment or a Letter of Credit is safer. If you sell on open account, consider credit checks and export credit insurance.
What does marine cargo insurance cover?
It covers loss or damage to goods in transit, depending on the clause chosen (for example the Institute Cargo Clauses A, B or C). Read the cover you buy, and keep your shipping documents consistent so that a claim goes smoothly.
Related on this site
- Marine cargo insurance
- Essential documents for Customs clearance
- Exim Compliance Desk
- How to verify a buyer or supplier before you pay or ship
- Landed cost and Incoterms: what an import really costs
Talk to us
Send us two lines on WhatsApp: the goods, the port or country, and what you need. We tell you what we need from you and our fee, in writing, before any work starts. We reply within one working day (Monday to Saturday, 10 AM to 7 PM IST).
Multimodal Logistic Systems Pvt. Ltd., Pune, India. Written by Shankar Jha, Customs and EXIM consultant with 27+ years of experience. Rules and notifications change; we check those in force on the date of your query.