IBM 416 Lecture Notes - Lecture 2: U.S. Bancorp, Wire Transfer, Fax
17 Mar 2016
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What are the facts and insights listed in the chapter? (p 178, 180, 181, 184) facts: many companies think that exporting is too risky. Credit cards are a popular method of payment for exports. some letters of credit are revocable, which means that you or the buyer can unilaterally make changes. As a result, such letters of credit carry more risk than irrevocable letters of credit. Even exporters who take precautions occasionally experience payment problems. Insights: you can reduce risk to a safe level. Letters of credit, export credit insurance programs, and reference checks through banks and international credit reporting agencies can help protect you. Trade laws are often straightforward, and legal advice about them is easily obtained. Because international credit card transactions are typically handled by telephone or fax, fraud can be an issue. Determine the validity of transactions and obtain the proper authorizations before sending goods or performing services. Smart exporters insist on irrevocable letters of credit.
