Export/import financing in which a bank acts as an intermediary without accepting financial risk is called ________.
A) documentary collection
B) counterpurchase
C) buyback
D) open account

Question

Quizplus · Accepted Answer

When a bank acts as an intermediary in export/import financing without accepting financial risk, it is known as "documentary collection." In this process, the bank only facilitates the payment process but does not take any financial responsibility for the transaction. Counterpurchase, buyback, and open account all involve some level of financial risk for banks.

Export/import Financing in Which a Bank Acts as an Intermediary