Collection letter

A letter or form that conveys the drawer´s instructions to the presenting bank. While there are many variations, collection letters identify the drawer, drawee, and any case-of-need party; typically contain a series of boxes that apply to various instructional points. There are two kinds of collection letters: those originating from the drawer´s bank and those originating from the drawers or its agent, called direct collection letters. Either way, the presenting bank receives the collection letter, endeavours to follow its instructions, and reports to the drawer´s bank. Also called collection instructions.

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