Cambodia - Methods of PaymentCambodia - Methods of Payment

Letters of credit are the most common method used to facilitate payment and are preferred over bank guarantees, cash in advance, and open accounts.   Other payment methods such as forward exchange contracts, standby letters of credit, foreign currency loans, and import and export letters of credit can be tailor-made to an individual importer or exporter.  Instruments and methods of payment offered by banks vary, ranging from import and export documentary collections, documentary export and import credits, open account, consignments, cash-in-advance, and guarantees.  For large-scale business transactions, exporters and importers are required to have bank guarantees, such as shipping, bid, payment, advance payment, performance, and retention money guarantees.  Private commercial banks provide trade finance services and have foreign correspondent banks in the United States, Europe, Asia, and elsewhere. Not all Cambodian commercial and specialized banks, however, handle trade finance.  Commercial banks in Cambodia may use an external credit rating agency, such as Standard & Poor’s.