Podcast
Questions and Answers
Which risk can be mitigated by obtaining a credit report for the seller?
Which risk can be mitigated by obtaining a credit report for the seller?
- Credit risk
- Risk due to exporter (correct)
- Risk due to importer
- Market risk
How much currency is loaded in MCTC?
How much currency is loaded in MCTC?
- 15
- 25
- 10
- 20 (correct)
Is LC open for imports of prohibited goods?
Is LC open for imports of prohibited goods?
- False (correct)
- True
What is the threshold amount for requiring a BG for advance payment?
What is the threshold amount for requiring a BG for advance payment?
Does advance against incentives come under post-shipment finance?
Does advance against incentives come under post-shipment finance?
Flashcards
Exporter Risk
Exporter Risk
The risk of financial loss due to the exporter failing to fulfill their obligations.
MCTC Currency
MCTC Currency
The amount of currency available in an MCTC (Multi Commodity Trade Centre) account for trading.
LC for Prohibited Goods
LC for Prohibited Goods
No, Letter of Credit (LC) cannot be used for imports of prohibited goods.
BG Threshold
BG Threshold
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Advance Against Incentives
Advance Against Incentives
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Study Notes
Mitigating Risks
- Obtaining a credit report for the seller can mitigate the risk of non-payment.
MCTC (Mobile Cash Tender Container)
- MCTC is loaded with $10,000 or €10,000 currency.
Letter of Credit (LC)
- An LC is not open for imports of prohibited goods.
Bank Guarantee (BG) for Advance Payment
- A BG is required for advance payments exceeding ₹10 lakh ( ₹1 million).
Post-Shipment Finance
- Advance against incentives does not come under post-shipment finance.
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