Common payment terms used by Chinese suppliers in international trade vary by industry and client relationship
- Advance Payment
- 30%-50% upfront for new clients or custom orders, balance before shipment. Reduces supplier risk for bespoke products (e.g., hardware, machinery parts).
- Letter of Credit (L/C)
- Bank-guaranteed payments: Sight L/C for immediate settlement, Usance L/C for deferred payments (30-90 days after presentation of documents). Suitable for large transactions.
- Telegraphic Transfer (T/T)
- Pre-T/T: Full payment before production/shipment.
- Post-T/T: Payment against B/L copy (3-7 days) or net terms (30-90 days) for trusted clients.
- Documents against Payment (D/P)
- Buyer pays upon document presentation (sight or deferred), the seller retains control until payment.
- Open Account (O/A)
- Payment within 30-120 days after delivery, reliant on buyer credit. Often paired with export credit insurance.
- E-commerce Platforms
- Alibaba Trade Assurance or PayPal: Prepayment or secured payments with short settlement cycles.
- Stablecoins (e.g., USDT/USDC)
- Emerging trend for instant cross-border payments, hedging currency risks in EU/SE Asian markets.
