Collecting Bank

A Collecting Bank is a financial institution that acts as an intermediary in international trade transactions. When an exporter (seller) ships goods to an importer (buyer), the collecting bank is designated by the exporter to receive payment from the importer on their behalf. The collecting bank plays a crucial role in ensuring the safe and efficient transfer of funds from the importer to the exporter. It verifies the accuracy and authenticity of payment instructions and related shipping documents before releasing the payment to the exporter. The collecting bank may also offer additional services, such as advising and confirming letters of credit.