If you have a long-standing, trusted relationship with your supplier, you might find a Letter of Credit too expensive. In 2026, many Nigerian traders are switching to Documentary Collection (D/C)—a simpler, bank-facilitated payment method.
1. D/P (Documents against Payment)
Also called ‘Cash Against Documents’ (CAD). Your supplier sends the shipping documents to your bank. You only get the documents (to clear your goods) when you pay the bank in full. It’s safer for the seller, but doesn’t offer the credit of a Usance LC.
2. D/A (Documents against Acceptance)
The bank gives you the documents as soon as you ‘accept’ a Bill of Exchange, promising to pay in 60 or 90 days. In 2026, this is the ultimate trust-based payment method. Warning: Banks do not guarantee payment in D/C; they only act as couriers for the documents.
3. Why Choose D/C?
D/C is significantly cheaper than an LC because the bank isn’t ‘lending’ its reputation—it’s just handling the paperwork. It’s ideal for high-volume, lower-margin shipments like spare parts or textiles.
Conclusion
D/C is fast and cost-effective but requires high trust. If it’s your first time working with a supplier, stick to an LC. Ready to start? Check our guide on Opening a Form M.