Cash in Advance

Cash In Advance

Payment by cash-in-advance or prepayment means that the importer pays in full for the goods before they are shipped.

Cash-in-Advance

Payment by cash-in-advance or prepayment means that the importer pays in full for the goods before they are shipped. In this situation, the importer rather than the exporter assumes the risk of non-payment.

Exporters may require cash-in-advance when accepting orders from new customers or customers whose creditworthiness is poor or unverified, when exporting to markets with substantial political or economic risks or when their products or services are unique, scarce or in high demand. Exporters who accept a large volume of orders over the Internet may offer credit card or other electronic payments, which are effectively payments in advance.