Definition
A trade payment arrangement where goods are shipped and delivered before payment is due, typically 30 to 90 days after invoice. It favours the buyer's cash flow but exposes the seller to non-payment risk, so it is usually reserved for established trading relationships. It is the simplest and cheapest settlement method but carries no banking guarantee.
Frequently asked questions
What is Open Account?
A trade payment arrangement where goods are shipped and delivered before payment is due, typically 30 to 90 days after invoice. It favours the buyer's cash flow but exposes the seller to non-payment risk, so it is usually reserved for established trading relationships. It is the simplest and cheapest settlement method but carries no banking guarantee.
Which glossary terms are related to Open Account?
Open Account is a procurement term in the South African import/export industry. Related terms in the same area include Advance Payment, Bank Guarantee, CSD (Central Supplier Database), Designated Sectors, Documentary Collection — each has its own plain-English definition in the TradeCaravan glossary.