Non-trade remittance is a part of international remittance business, as opposed to remittance under trade. It is also a kind of entrusted bank payment and settlement method in which the debtor or payer entrusts the bank to remit money to overseas creditors or payees. It is mainly used for capital borrowing, debt repayment, capital transfer, free gift, private remittance, etc.
Non-trade remittance also includes three remittance methods: letter remittance, wire transfer and draft remittance. Remittance and remittance of various remittance methods are basically the same as trade remittance.
2. Non-trade letter of credit settlement method
Non-trade letter of credit refers to the clean letter of credit issued by the bank to the bank with which the applicant has an agent relationship at the request of the applicant, which mainly includes the clean letter of credit used by foreign affairs institutions, the tourist letter of credit used by tourists and the global travel letter of credit.
3. Traveler's check settlement method
Traveler's check is a kind of check issued by a bank or travel agency for travelers to reduce and avoid the trouble of carrying cash. Travelers can take them with them after buying traveler's checks, which can be used to pay for restaurants, shops and so on. And withdraw cash from the bank.
4. Credit card settlement method
As a settlement tool, credit card is widely used in international non-trade settlement.
The initial non-trade settlement is cash settlement. Later, it developed into a market bill and began to settle non-trade with clean receipts. At present, the international non-trade balance of payments is settled in a non-cash way, mainly through bank settlement bills. A small amount of non-trade foreign exchange can also be converted into local currency in freely convertible currencies abroad. International non-trade settlement is conducted in two or more countries in a bilateral or multilateral way. No matter which country's currency is used, payments are usually converted into local currency, or funds are deposited in an account at the relevant currency center. For example, dollars remitted to London are deposited in the bank account opened by the payee in the United States. Non-trade foreign exchange income mainly comes from the provision of labor services and various services, and there is no need to export commodities, so most countries strive to improve the quality of services and strive for more foreign exchange. China has various preferential measures in terms of remittances, foreign exchange for tourism and the return of private foreign capital. Non-trade settlement can be spot or forward. Draft at sight can be paid on presentation. A time draft is accepted at presentation and paid at maturity.