Every export deal has two fears in it. The exporter fears shipping goods and never being paid. The buyer fears paying and never receiving the goods, or receiving the wrong goods. Payment terms are how the two sides share that risk. For made-to-order imitation jewellery, where the factory spends material and labour before anything ships, choosing terms well matters even more.
The main payment terms, from safest for the exporter
1. Full advance (cash in advance)
The buyer pays the whole amount by bank transfer before production or before dispatch.
- Exporter risk: none.
- Buyer risk: high. They trust you completely.
- Where it fits: small first orders, buyers who already know you.
2. Part advance, balance before dispatch
For example 50% or 60% with the order, the rest when goods are ready, often after the buyer has seen photos or a video of the finished stock.
- Exporter risk: low. Production cost is covered and goods do not leave until the balance arrives.
- Buyer risk: moderate, reduced by approving the finished goods on video.
- Where it fits: most repeat wholesale orders in made-to-order jewellery. It mirrors how Indian factories commonly work with domestic wholesalers.
3. Documents against payment (D/P)
You ship, then send the shipping documents to the buyer's bank through your bank. The buyer's bank hands over the documents only when the buyer pays.
- Exporter risk: medium. If the buyer refuses to pay, the goods are already abroad and you must find another buyer or bring them back.
- Where it fits: sea shipments with established buyers. Less useful for air and courier, where goods often reach the buyer before the documents do.
4. Documents against acceptance (D/A) and open account
The buyer receives the goods and pays later, 30, 60 or 90 days after shipment.
- Exporter risk: high. You are giving credit to a buyer in another country.
- Where it fits: long, trusted relationships only, ideally with export credit insurance.
5. Letter of credit (LC)
The buyer's bank promises to pay once you present documents that match the LC's conditions exactly.
- Exporter risk: low, provided your documents comply to the letter.
- Costs: bank charges on both sides, and discrepancy fees if anything does not match.
- Where it fits: large orders and new relationships where both sides want a bank in the middle. For small jewellery orders the cost and paperwork are often out of proportion.
Comparison at a glance
| Term | Exporter risk | Buyer risk | Paperwork |
|---|---|---|---|
| Full advance | None | High | Light |
| Part advance, balance before dispatch | Low | Medium | Light |
| Documents against payment | Medium | Low | Medium |
| Letter of credit | Low | Low | Heavy |
| Open account | High | None | Light |
Rules every Indian exporter must follow
- Realise the money within 15 months. Under FEMA rules amended by the RBI in November 2025, export proceeds must be brought into India within 15 months of the date of export (it was 9 months before). Your bank tracks this against your shipping bills in its export data system.
- Advance received, shipment due. Where a buyer pays in advance, the shipment should follow within the time the RBI allows. That window was extended to three years in the same change, but buyers will not wait that long.
- Receive payment into your own account. Payment from a third party or through informal channels creates problems with the bank's reconciliation and with GST refunds.
- Keep invoice numbers consistent on the invoice, shipping bill and the bank transfer reference.
Practical tips for jewellery exporters
- Quote in one currency and state who bears bank charges. "All bank charges outside India on buyer's account" avoids small shortfalls.
- Price the currency risk on long production cycles. If the order takes a month to make, agree the rate or the price at order time.
- Use a pro-forma invoice as the basis for any advance, listing design codes, quantities, prices, Incoterm and delivery time.
- Approve before dispatch. A photo or video of the finished pieces, with design codes visible, settles most disputes before they start.
How we work
Jagruti makes most designs to order. For catalogue orders we take an advance to start production and the balance after you approve a video of the finished stock, before dispatch. For export customers we quote ex-works or FOB Mumbai in the currency you prefer, and confirm terms on the pro-forma. Read more on our export supply page or apply for a trade account.
Related: EXW vs FOB vs CIF pricing and the export documents checklist.