Coffee Export Payment Terms
LC, TT, and advance payment explained — which term protects you, and how each works for a coffee import order.
Payment Terms Are About Shared Risk
Every payment structure balances risk differently between buyer and seller. Understanding the trade-offs upfront helps you negotiate terms that fit your order size and how well the relationship is established.
We work with all three structures below and typically recommend a path based on order size, buyer history, and destination market.
LC vs TT vs Advance
Letter of Credit (LC)
Best for: First-time buyers, large ordersA bank-issued guarantee that payment releases once shipping documents match the LC terms exactly. Highest security for both sides, but slower and involves bank charges.
Telegraphic Transfer (TT)
Best for: Established relationships, repeat ordersDirect bank wire, usually split as a deposit before production and balance before or against shipping documents. Faster and cheaper than LC, but relies on trust built over prior orders.
Advance Payment
Best for: Small trial orders, samples-to-bulk transitionFull or majority payment before production begins. Common for first small orders where both sides are still establishing the relationship.
Common TT Payment Split
Deposit (Before Production)
30%
Balance (Against Documents)
70%
Exact splits are negotiated per order and buyer relationship.
Payment Terms — FAQs
Which payment term is safest for a first-time importer?
A Letter of Credit offers the strongest protection, since a bank verifies shipping documents before releasing payment — it costs more in fees but reduces risk on both sides.
What is a typical TT payment split?
A common structure is 30% deposit before production and 70% against shipping documents, though exact splits are negotiated per order.
Can payment terms change as the relationship develops?
Yes — many buyers start with advance payment or LC on their first order and move to a lower TT deposit percentage as trust builds over repeat shipments.
Who pays the bank charges on a Letter of Credit?
This is negotiated per contract — commonly each party covers charges levied by their own bank.
Want to Discuss Payment Terms for Your Order?
Tell us your order size and destination — our export team will recommend a payment structure that works for both sides.
Contact Our Export Team
Email: export@leelaprasadcoffee.com | Phone: +91-96869 95189
Monday–Friday · 9:00 AM – 6:00 PM IST · Response within 24 hours