Discounting D/A ODC

Simple is Beautiful; the only thing came in my mind when thought of documentary collection. And I think more and more people are thinking the same in these days. Documentary Collection offers us far greater security than selling on open account; but not as much as a documentary credit. We should therefore be more cautious before starting selling using this method of payment. Documentary Collection Forum is an effort to help you on this way – admin;
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Discounting D/A ODC

by mohamedbahgat » Fri Oct 13, 2017 2:50 am

How can a bank can save its rights while discounting a draft against acceptance under a documentary collection taking in to consideration that the collecting bank will not avalize this draft ? what if the drawee accepted the draft and the goods were in a good order but he refused to pay ,what can the discounting bank do in this case ?

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Re: Discounting D/A ODC

by FaisalFahim » Sun Nov 05, 2017 9:48 pm


if the drawee accepting the draft it will then liable to pay the collecting bank on every cost on or before the date of maturity, and with respect to your question of discounting to drawee, remitting bank will get the payment from collecting/presenting bank on or after maturity.

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Re: Discounting D/A ODC

by picant » Wed Dec 20, 2017 11:21 am

Hi Pal,

probably you have recourse against your customer/drawer, the collecting bank may note or protest the accepted draft, then the drawer may sue the drawee for no payment as per contract terms.
By discounting a bank bears the risk of no payment at maturity.
Other comments appreciated

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