Discusses the most common methods of payment, such as open account, letter of credit, cash in advance, documentary collections, factoring, etc. Includes credit-rating and collection agencies in this country. Includes primary credit or charge cards used in this country.
Last Published: 10/19/2018

Most Czech firms use prepayment or partial prepayment, with the balance due upon delivery or net 30-day terms. For shipments under $2,000, consider asking the buyer to pay by credit card. Czech firms are familiar with letters of credit, documentary collections, and wire transfer/cash in advance. Most would prefer not to use a letter of credit due to the high cost. Although smaller sales of U.S. goods (up to about $50,000) are common, above this threshold many small Czech businesses cannot afford or secure financing. A U.S. firm's ability to provide or arrange financing can be effective in building significant market share.

The most attractive solution for exporters of consumer goods and industrial components may be to offer a distributor a container of products on consignment, and to enable the distributor to use proceeds from the first container to finance additional containers. For higher value items, financing is tricky, yet crucial. Lease finance is an increasingly popular approach for equipment, vehicles, and other large capital items. Exporters should contact the U.S. Eximbank and the Small Business Administration for information about their trade financing programs. In addition, a number of U.S. state and port authorities may offer financing assistance.
Moody’s Investors Service EMEA Limited Czech Branch is the only credit rating agency in the Czech Republic. There are 25 major collection agencies, 80 percent of which are members of the Collection Agencies Association - in Czech only). The Association is a member of FENCA (European Federation).

The main credit cards used in the Czech Republic are MasterCard and Visa which are issued by all major local banks. The most common type is debit cards (about 70 percent of all cards) followed by credit cards (about 28 percent). Charge cards issued by Diners Club and American Express are rarely used by Czechs although they are generally accepted in tourist area shops, large hotels and shopping malls. American Express Personal Cards are available in the Czech Republic. They are denominated in U.S. dollars or euros, issued in the UK and serviced in English.
 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.