Documents Against Acceptance

Category: Payments

Definition (plain English)

A documentary collection where documents are released after the buyer accepts a time draft promising payment on a future due date.

Why it matters commercially

D/A improves buyer liquidity but leaves the seller exposed after document release, so creditworthiness, country risk, recourse, and insurance matter more than under D/P.

Example

A seller considered D/A 60 days after sight only for an established distributor with approved credit, insured receivables, and a clear overdue escalation path.

Common mistake

Using D/A because the buyer asks for credit without treating it like open-account risk backed by a signed draft, credit check, and collection plan.

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