Лекции по английскому языку для изучающих банковское и финансовое дело. Лекции по английскому языку для изучающих банковское и финансов. Составитель Н. А. Самуэльян
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Part Two Unit One Methods of Payment Active Vocabulary: payment in advance open account Bill of Exchange Documentary Letter of Credit cash with order cash on delivery remit integrity consignment
TEXT Head the text carefully concentrating on its contents and terminology: Compared to selling in the domestic market, selling abroad can create extra problems. Delivery generally lakes longer and payment for goods correspondingly can take more time. So exporters need to take extra care in ensuring that prospective customers are reliable payers and that payment is received as quickly as possible. In the first and in the last analysis, payment for exports depends on the conditions outlined in the commercial contract with a foreign buyer. As explained previously, there arc internationally accepted terms designed to avoid confusion about cost and price. The way exporters choose to be paid depends on a number of factors: the usual contract terms adopted in an overseas buyer's country, what competitors may be offering, how quickly funds are needed, the life of the product, market and exchange regulations, the availability of foreign currency to the buyers, and, of course, whether the cost of any credit can be afforded by the buyer or the exporter. There are four basic methods of payment providing varying degrees of security for the exporter:
I. Payment in advance. Clearly the best possible method of payment for the exporter is payment in advance. Cash with order (CWO) avoids any risks on small orders with new buyers and may even be asked for before production begins. However, this form of payment is extremely rare in exporting since it means thai 152 153 an overseas buyer is extending credit to an exporter — when the opposite procedure is the normal method of trade. Variations in this form of payment are cash on delivery (COD) where small value goods are sent by Post Office parcel post and are released only after payment of the invoice plus COD charges. 2. Open account. An exporter receives the greatest security of payment from cash with order or from cash on delivery. At the other extreme payment on open account offers the least security to an exporter. The goods and accompanying documents are sent directly to an overseas buyer who has agreed to pay within a certain period after the invoice dale — usually not more then 180 days. The buyer undertakes to remit money to the exporter by an agreed method. The open account method of payment is increasingly popular within the EEC because it is simple and straightforward. 70 per cent of UK exports are paid for under open account terms. It saves money and procedural difficulties but the risk to the exporter is obviously greater. It is only successful if an exporter trusts the business integrity and ability of an overseas buyer, something that has probably been established through a sustained period of trading. / A variation of open account payments the consignment account where an exporter supplies an overseas buyer in order that stocks are built in quantities sufficient to cover continual demand. The exporter retains ownership of the goods until they are sold, or for an agreed period of time, after which the buyer remits the agreed price to the exporter. However, a large proportion of export contracts cannot be settled by payment in advance or by open account, particularly with sales outside the EEC. So, parallel with the development of international trade throughout the world, the trading community has developed methods of payments which involve the transfer of documents for exported goods using 154 the international banking system — with the aim of speedily settling export transactions at minimum risk to exporters and to overseas buyers. I Comprehension. Answer the followi?ig questions:
10. Besides payment in advance and by open account, what other methods of payment has the trading community worked out? II Comprehension. Complete the following sentences on the basis of the information given in the text: 1- The method of payment you adopt for each customer de pends on many factors, such as &• The use of Incolcrms in commercial contracts helps •>• The choice of the method of payment is important as each of them provides 755 Active vocabulary: bill of exchange payment on presentation payment on demand bearer a bill drawn on ... I I 1
10. You can speedily settle export transactions at minimum risk using Ill Test. Fil in the missing words: The method of obtaining payment of an export order is usually a matter ... negotiation ... the exporter and his buyer and will in many instances be governed ... the exporter's knowledge of the buyer andjlje-buyer's financial standing. In deciding the terms ... payment to negotiate, the exporter may perhaps wish the degree ... security he obtains, the speed ... remittance and any additional costs involved. In rare cases an exporter is able to persuade his buyer to pay 100 per cent of the ... value before ... take place. II is quite common, however, for the buyer to make an ... pay ment of a percentage of the contract value upon ... of the contract with the balance being... by one of the agreed methods. Where the exporter has complete faith in the buyer he may be willing to trade on an ... account basis. This usually meansrthat the buyer receives the ..., lakes ... of the goods and thereafter makes ... to the exporter in accordance with previously agreed .... Unit Two Bill of Exchange (B/E) - переводной вексель, тратта платеж по предъявлению - платеж по требованию
settlement — заключение сделки sight draft —1) вексель на предъявителя term draft tenor of the bill due date 2) тратта на предъявителя
' — срок погашения кредитного обязательства; срок платежа acceptance — 1) принятие, акцепт, согласие на оплату face of the bill forward a bill collecting bank clean bill 2) акцептование векселя
cash againts documents — платеж наличными против документов 156 157
2) прямой денежный сбор notary notice of dishonour
2) уведомление о неуплате векселя : TEXT Read the text below concentrating on its contents and ter minology: An exporter can send a bill of exchange for the value of the invoice of goods for export through the banking system for payment by an overseas buyer on presentation. A bill of exchange is legally defined as "an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to which it is addressed lo pay on demand or at a fixed or determinablc future time a certain sum of money, to or to the order of a specified person, or to the bearer". In other words an exporter prepares a bill of exchange which is drawn on an overseas buyer, or even on a third party as designated in the export contract, for the sum agreed at settlement. The bill is called a sight draft if it is made out payable at sight i.e. "on demand". If it is payable "at a fixed or deter minable future time" it is called a term draft, because the buyer is receiving a period of credit, known as the tenor of the bill. The buyer signs an agreement to pay on the due date by writing an acceptance across the face of the bill. By using a bill of exchange with other shipping documents through the banking system, an exporter can ensure greater control of the goods, because until the bill is paid or accepted by the overseas buyer the goods cannot be released. Conversely, the buyer docs not have lo pay or agree to pay by some agreed dale until delivery of the goods from the exporter. An exporter can pass a bill of exchange lo a bank in the UK. The UK bank forwards the bill to its overseas branch or to a correspondent bank in an overseas buyer's country. This bank, known as the collecting bank, presents the bill to whomever it is drawn upon, for immediate payment if il is a sigh I draft, or for acceptance if il is a term draft. This^procedure is known as a clean bill collection because there are no shipping documents required. Clean bill collections have become more popular, parlicularly in some European counlries where Ihe method is also used in internal Irade. Also such collodions provide more security than open account lerms if Iherc is some doubt aboul a buyer's financial slalus. However, il is more likely lhat bills are used in a documentary collection method of payrnenl. In Ihis case, an exporter sends the bill lo Ihe buyer Ihrough Ihe banking syslem wilh Ihe shipping documents, including Ihe documenl of tille lo the goods, i.e. an original bill of lading. The bank Ihen releases the documents on payment or acceptance of the bill by the overseas buyer. An exporler can even use the banking system for a cash againsl documenls (CAD) colleclion. In Ihis case only Ihe shipping documenls are senl and Ihe exporler instructs the bank to release them only after payment by the overseas buyer. This method is used in some European counlries whose buyers often prefer CAD lo a sighl draft if the cx- 158 159 porter insists on a documentary collection for settlement о the export contract. In all the methods of payment using a bill of exchange, ; promissory note can be used as an alternative. This is issued by a buyer who promises to pay an exporter a certain amouni of money within a specified time. It is even possible to send the documents and bill of exchange directly to an overseas buyer's bank, by-passing the UK hank. This system of direct collection is widely supported by US banks, but it dispenses with the help of the UK bank whose aid can be invaluable if something goes wrong in the collection. For example, there could be excessive shipping delays so that a buyer may refuse to accept or pay a draft on presentation. In this situation the UK bank can act as the exporter's agent by arranging the warehousing of the goods or their reshipmenl, or even disposing of them at auction to recoup any outlay. An overseas buyer may deliberately default on a term bill or just go bankrupt. In either case the UK bank can arrange legal action or act on instructions to initiate protests, i.e. engage a notary public in the buyer's country to deliver a "notice of dishonour" to the defaulter, thus preparing a likely settlement in favour of the exporter if matter have to go to court. I Comprehension. Complete the following on the basis of the infonnation given in the text:
6 A term draft does not have to be paid at sighl but at
10. A documentary bill collection means that , the most important of which is ...
it involves a certain risk particularly when there is 17. If the buyer refuses to accept or pay a draft on presenta- tion, the exporter's bank 18. To protest a draft means to ...... II Explain the following terms and give your own examples: Account Bill Cash Collection Dale Default Draft Note Notice Payment Settlement 161 Ill By adding appropriate suffixes (-er, -or, -ее) if possible form a list of terms you already know from business and general economics indicating: a) a person who does a certain activity, b) a person to whom this activity is directed (if such a term exists):
10. Work a) b) IV Studying a Bill of Exchange. Examine the legal definition of a bill of exchange and the enclosed sample copy and find out:
h) who the drawee should pay the above mentioned sum to. г 162 Ihc terms of the credit revocable/irrevocable cancel amend advise a letter of credit advising bank confirming bank issuing bank \ compatible with ... reimburse debit Test. Fill in the missing words: The bill of exchange is often used as a means of pay ment particularly for goods exported. The importer might, for example, ask to delivery of goods before paying for them. The exporter, on the other hand, will probably not wish to his control over the goods before obtain ing or a legal undertaking from the to pay on a given future date. By use of the international system, a document of title and a bill of , the needs of both parlies may be sat isfied. The exporter might a bill exchange on the buyer and pass it with the documents and instructions to a bank in the buyer's country, which would Ihe bill of exchange to the buyer for immediate payment in the case of a bill or for acceptance in the case of a bill. Should the buyer refuse, the documents will not be and if the documen ts include a full set of of lading then the con trol of the relevant goods remains with the acting as agent for the exporter who thereby also retains of Ihc goods. Unit Three Documentary Letter of Credit Active Vocabulary: expiry dale — 1) истечение срока действия контракта 2) истечение срока опциона
 TEXT Read Иге lexl below concentraliiig on Us contents and terminology: By sending documents through the banking system in a documentary bills collections, both an exporter and an overseas buyer have some degree of security in completing the commercial contract. Bui a more secure method of carrying out the transaction is by a documentary letter of credit. This 165 documentary letter of credit when transmitted through a bank, Usually in the exporter's country, becomes the means by which the exporter obtains payment. The necessary documents, correctly completed, are presented to a bank by the expiry date of the credit. If the terms of the credit are met an exporter can receive payment from a UK bank. The buyer is in effect providing the exporter with immediate payment in return for a guaranteed assurance from a reputable bank that the export documents required to deliver the goods have been completed to the bank's satisfaction. Documentary credits may be revocable or irrevocable. A revocable letter of credit is rather rare nowadays because it means that the terms of the credit can be cancelled or amended by an overseas buyer at any time without prior notice to the exporter. Most letters of credit are irrevocable, which means that once a buyer's conditions in the letter have been agreed by an exporter, they constitute a definite undertaking by the buyer's bank and cannot be revoked without the exporter's agreement. UK banks advise letters of credit, i.e. on presentation of documents required in a letter of credit, they send them for collection and payment by the issuing bank of an overseas buyer. The letter of credit in this situation is only as good as the strength of the overseas bank involved. An exporter's advising bank undertakes no responsibility itself to pay the exporter. Even better security is achieved if the irrevocable letter is confirmed by an advising bank in the UK. Then the UK confirming bank stands fully in place of the issuing bank abroad, and provided all the terms and conditions of credit are fulfilled by an exporter, payment is assured by the banking system without recourse, i.e. without further call on the exporter. So when an exporter has negotiated in the contract with the buyer for a confirmed irrevocable letter of credit then security of payment, as far as humanly possible, is achieved. But whether or not the credit is confirmed it is essential that the exporter checks the credit terms immediately to make sure they are compatible with the commercial contract made with the buyer. In dealing with documentary credits the bank is concerned only with the documents to be presented and not with the goods or services involved. Documentary credits may provide for payment at sight or for acceptance of a term bill of exchange by either the issuing bank in a buyer's country or the correspondent bank in the UK. Comprehension. Answer the following questions: 1. Which method of payment provides the greatest security for the exporter?
trade?
II Comprehension. Complete Hie following:
166 167
by 5. Payment is assured without recourse means that provided the exporter Ill Give appropriate economic terms for the following:
10. Charge somebody with a sum of money (in terms of book keeping) and ils opposilc. Now use the terms you have just formed in sentences of your own. IV Complete the following: 1. The firsl slep in any business Iransaclion is belween The agrecmenl specifies Ihc in Ihis case by
about in 4. The exporter's bank is called and il opens in g At the same time the exporter 7 When the shipping documents agree with the terms of the agreement 8. The next slep is lo 9 When all Ihe shipping documents comply with the terms of the conlracl 10. The issuing bank debils with Ц. When the paymenl has teen effected the buyer and can Test. Fill in the missing words: The exporter can obtain advance security thai selllcmcnl will be made if he is able lo arrange wilh Ihc buyer for Ihe issue of an crcdil. The buyer will requesl his local bank to a credil reflecting the precise documentation which he requires and the under which selllemcnl may be made. The buyer's bankers may send advice of Ihc cither di rect lo the exporter or through the inlcrmcdiary of a in the exporler's country. In the case of an irrevocable credil Ihc exporter may be certain that Ihc bank can neither cancel the : nor amend il wilhoul his consent. Should the exporlcr require greater security than thai af forded by the name of the issuing , he may be able lo arrange lhal an bank in his own country adds ils confir- malion lo the at Ihc requesl of the issuing bank. This will mean lhal Ihc confirming bank stands fully in place (>l the issuing bank , and, provided Ihe exporter Ihe terms and conditions of Ihe credil in every respect, he has assurance of 5. When Ihe goods are ready for shipment 168 Unit Four Remitting the Money Active Vocabulary: remittance cash flow cheque (br.) check (am.) draw a cheque on .. clear a cheque banker's draft clearance
1) чек 2) переводной вексель выписывать чек осуществлять клиринг чеков банковская тратта mail transfer telegraphic transfer производство расчетов через расчетную палату; клиринг векселей и чеков почтовый перевод телеграфный перевод Text There are several ways that a remittance from an overseas buyer can be transmitted to an exporter. An exporter's most important consideration is the speed at which this can be done — the quicker it is achieved the better an exporter's cash flow and the less the cost of any finance that may have to be^ raised to carry out an export contract. In the contract where payment is on open account terms payment by a cheque from an overseas buyer might seem the simplest method. But there are several disadvantages. The cheque will normally be drawn on the buyer's overseas bank in that national currency. So an exporter could be subject to loss when the foreign currency is exchanged into sterling: there could be delays due to exchange controls in a buyer's country; there could be postal delays; and there may be delays while the exporter's UK bank clears the cheque with the overseas buyer's bank. Payment could be made by a banker's draft. An overseas buyer's bank issues a cheque in favour of an exporter to be drawn on a bank in the UK. Exchange control problems in the buyer's country are avoided, but there could still be delays in the post and in clearances between the exporter's UK bank and any other banks in the chain of remittances. The most common form of non-documentary payment for exports is by mail transfer (International Money Transfer). An overseas buyer instructs a bank in the buyer's country to transfer an amount of money to an exporter's UK bank by airmail, and in due course, the exporter receives payment. Unfortunately this can be a slow process. However, the UK exporter's bank branch can assist the exporter in reducing to the minimum any delays in mail transfers. Although at first sight more expensive, a most effective way of making an international payment, because of the time saved, is by telegraphic transfer (Express International Money Transfer) or bank cable. Money is transferred by coded interbank telex and as long as the exporter makes it clear to the overseas buyer exactly which bank and account in the UK the remittance should be made to, the exporter, should receive very speedy payment through the system. Delays in remittance can cost money, even cancelling out the profit in any contract, especially when the exporter is Paying interest on any financing or the exporter's cash flow is severely affected. So it is worth the exporter consulting the UK bank about remittance procedures in open account contracts. The exporter should generally ask the overseas buyer to remit to a specified UK bank branch by telegraphic 770 171  transfer. If the export business warrants it, the export^. can consider opening bank account to collect funds and trans-fer them in bulk to the UK by telex at regular intervals.In a new development, major banks including Midland have set up a computer system for interbank transfers called SWIFT, the Society for Worldwide Interbank Financial Telecommunications. SWIFT can achieve same-day transfers between banks which are linked to the system. Whether exporting companies are large or small, they have to rely on specialists to achieve the most efficient (and therefore least costly) method of receiving payment. It is here thai banks can make one of their most important contributions lo export business. Comprehension. Answer the following questions: 1. What is the most important consideration for an exporter when agreeing on the method of transmitting the payment? 2. Why is speed in remitting money from the foreign buyer lo the exporter of the utmost importance?
9. When is il worthwhile for the exporler lo open a bank raccounl abroad?
172 II Comprehension. Fill in the following on the basis of the information given in the text: Ways of remitting money when trading on open account terms disadvantages 1) a) b) ' a) b) a) a) 2) 3) 4) The foreign buyer can pay Ihe exporter by HI Test. Fill in the missing words: As the cheque is most likely lo be payable in Ihe buyer's country, the exporter will need to il Ihrough Ihe bank ing system thus risking furlher and possible default. Sometimes the exporler may be able lo arrange for the cheque lo be by his bank. Exchange Conlrol in Ihe buyer's country may delay the of the cheque. In mosl instances the buyer can arrange for a bank in his country lo issue their on a bank in the UK in favour of Ihe As Ihe draft is ...... in the UK there should be little delay in paymenl. The foreign bank the draft will have ensured that any control regulations obtaining in the buyer's country will have been When payment for exporls is lo be made by mail Iransfer, the buyer's bank a corresponded bank in the UK by to pay funds lo the exporter or to the bank for credit to his 173 Unit Five Short-term Export Finance |