international payment in viettinbank

Topics: International trade, Bank, Foreign exchange market Pages: 20 (10306 words) Published: November 1, 2014
VietinBank, founded in 1988 based on the separation from Vietnam Bank, is one of the biggest 4 commercial banks in Vietnam, who plays an important role in banking sector. VietinBank is also on top 23 special enterprises of the country. General introduction about international payment in VietinBank from 2007 to 2009 International payment is one of the services that is being offered by VietinBank. The bank is currently a member of Vietnam Bankers Association, Asian Banker Association, Asean Bankers Association, Society for Worldwide Interbank Financial Telecommunication, etc. With many advantages from a wide subsidiaries and affiliates network and practical technologies, operation of international payment in VietinBank has maintained a rapid growth in recent years. The banks payment transactions in this period are always be handled timely and correctly, which is very responsive to customers needs. VietinBank reputation has also been raised in international field, from the event that foregin banks accepted imported letters of credit approved by VietinBank which are issued by other commercial banks in our country, and guarantee issuance of letters of guarantee for the reciprocal of the foreign bank with an increase in the value and the number of items. In 2008, VietinBank continued its expansion in the subsidiaries network throughout the world, with an agent relationship with more than 85 banks globally in 80 countries and territories. Cooperation with foreign banks are also strengthened in many ways based on the basis of mutual benefit. Export-sales ratio for this year went up to U.S 4.25 billion, 26 more than 2007 and accounted for 8 of export-sales of the whole country. Cross border payment still has a stable and strong growth with growth rates of over 50 compared with the previous year. Up to 2009, VietinBank finally completed having all international payment transactions of the system to be handled at transaction bureaus according to the new pattern. Along with the interest rate policy incentives and other service fees, import-sale payments have been increased significantly. Compared to 2008, export turnover reached U.S 4.5 billion, an increase of 7.3. CHAPTER I The basic knowledge of international payment and some methods of international payment in VietinBank. Remittance Definition Remittance is the dimpliest payment method in which a customers bank (referred to importer) requests the bank to transfer a certain amount to the beneficiary at a certain location. There are 2 forms of remittance TTTelegraphic Transfer Remittance and MTRMail Transfer Remittance. The telegraphic transfer remittance benefits to exporters for receiving money quickly and do not benefit to the importers because of the high cost. Process Stakeholders The remittance request - Payer (Buyer, importer) Remitting bank (Payers bank) The beneficiarys bank in foreign country Beneficiary (Buyer, exporter) Diagram 1 Remittance payment processing Note The exporter transfers goods and documents to the importer. After being checked by importer, if goods (documents) meet the requirement of the contract, setting the procedures to transfer the money to the remitting bank. Remitting bank immediately transfer the agreed amount of money to the beneficiarys bank in foreign country Beneficiarys bank pays money to the exporter. Remittance is the direct payment method between the exporter and the importer. The bank only plays the intermediate role to receive the commission and has no constraints with both exporter and importer. We only apply this method when there is trust between the exporter and the importer. The Collection The collection means the seller (exporter) after completing his delivery duty authorizes his bank to present documents to the Collecting bank (importers bank) in order to obtain payment and/or acceptant B/E or fulfill other terms and conditions. In this relationship, banks on both sides of the countrys exports and imports, only involved as...
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