BPO Letter to Bank Form – a new payment Method for Trade
Free Printable BPO Letter to bank Form or Bank Payment Obligation letter form is a path of payment. It is a bit different from the conventional payment systems. This system is accepted in:
- Banks those present commercial services
- Companies those distribute or receive large number of invoices or amounts from third parties
- Companies those use on e-invoicing method
Definition – A BPO is an immutable activity of the purchaser’s bank to pay a particular amount to the seller’s bank on a specific date after the successful match of electronic data.
The working process of BPO
- Firstly, a seller requests the seller bank to take necessary steps for a transaction between buyer and seller under Bank Payment Obligation.
- The seller’s bank puts this information in a data matching system. It also includes information that the buyer’s bank issues in support of seller’s bank.
- Next, the buyer’s bank receives that information and checks for its acceptability.
- Once this verification process is over, the payment obligation turn into irreversible
- After a successful transaction of goods, this data matching process is repeated, and if it matches, the payment process continues.
There is a long list benefit for both buyer and seller and moreover for the banks.
For a buyer, BPO system is safe, easy than prepayment and a smooth way of financing. The buyer can maintain a modified payment structure, specific payment and be capable of managing the quality.
For a seller, it provides an assurance of payment, flexible economic system and diminishes complexity, cost, and risk factors.
Benefits for banks are low risk, opening up new trade chances and they can make an idea about market requirements.
Free Printable BPO Letter to bank Form thus makes a network between buyers, sellers, and banks.