Payment plays an important role in the course of business. If payment is not ensured then all will be meaningless. Payment in foreign trade is often complicated and the settlement of foreign amounts may be made in a number of ways, such as D/P, D/A, L/C and so on. Each payment term has its own advantages and disadvantages. For instance, D/P saves the cost for the buyer, but increases the risk of nonpayment to the seller; L/C increases the cost and ties up the funds of the buyer, but it guarantees the payment to the seller. Therefore, both the seller and the buyer prefer to adopt the payment terms that are most beneficial to themselves.

Key:
L/C:  Letter of Credit  信用证                                                
D/P:  Documents Against Payment 付款交单          
D/A: Documents Against Acceptance 承兑交单          
COD:   Cash on Delivery 货到付款          
D/D:   Demand Draft 票汇              
M/T:  Mail Transfer 信汇                
CWO:  Cash with Order 定货付现          
CAD:  Cash Against Document 交单付款
P.O.D Pay on Delivery 货到付款  
T/T   Telegraphic Transfer 电汇        
Documents against Payment at Sight 即期付款交单          
Documents against Payment after Sight  远期付款交单      
Clean Bill for Collection 光票托收      
Documentary Bill for Collection 跟单托收