Taking your business Internationally can bring new opportunities and challenges! To reduce payment risk of international transactions experts recommend using an Escrow service. Escrow service is recognized as a viable payment technique to be used for export trade in the third edition of the U.S. Department of Commerce International Trade Association’s 2012 Trade Finance Guide.
Simply put escrow payment service ensures both the seller and buyer gets the intended benefits over a trade. It reduces potential risk of fraud on both party and it acts as trusted third party that collects, holds and disburses funds according to buyer and seller instructions.
Online escrow services are provided by bonded escrow agents. Suited for small to large value merchandise or intellectual property where conventional payment system is either unsuitable or un-economic. Typically used for items purchased on auction sites: personal goods, domain names, vehicles, commercial goods, etc.
Exporters use escrow for collecting payment from export shipments where the buyer is unwilling to pay in advance and Letter of Credit is an expensive option.
It is commonly used for a first-time transaction where buyer and seller are conducting business for the first time and are unfamiliar with each other. For exporter, escrow is the safest way around avoiding chargebacks and payment fraud/scam form unknown payment sources. For importer, a credible intermediary can always help in between buyer and seller to build trust in each other.
Seller is protected by escrow in a way that buyer is first required to deposit the full payment before seller ships the ordered product. Likewise, buyer is protected, since escrow will only be released once the buyer has taken delivery of the product. The buyer does the usual inspection of the product’s quality and then accepts the release of payment to seller from escrow.
Escrow methods varies when buyer is not satisfied with the product, seller has no option but to replace the product as far as escrow is concerned buyer is already fully paid. The buyer’s responsibility now is to return the product to the seller with full proof of the damage, or the reason behind buyer rejected the said product.
Escrow provides a Win/Win for both parties. Upfront payment deposited into escrow and delivery of product all are required if you want safe and trustworthy transactions between new buyer and seller relationship.
PaySAFE, a USA company headquartered in Nebraska, provides online escrow services for exporters and importers. Through www.PaySAFEescrow.com you can create a transaction within minutes. PaySAFE’s online escrow service allows you to close transactions with confidence.