Paying a new overseas factory safely: TT vs Letter of Credit

The hardest moment in a first order isn’t choosing a factory — it’s sending the money. Do it wrong and you’re exposed; do it right and both sides are protected. Here’s how experienced importers pay a new supplier safely.

What is the difference between TT and a Letter of Credit?

A TT (telegraphic transfer / wire) is fast, cheap, and simple — but on its own it puts the risk on whoever pays first. A Letter of Credit is a bank’s guarantee: the factory only gets paid when it presents documents proving it shipped exactly what was agreed. TT relies on the partner; an LC relies on the paperwork.

An LC costs more and involves bank paperwork, but for a large or first order it protects both parties — the buyer knows payment releases only against proof of shipment, and the factory knows the funds are committed.

What is a safe way to pay a new garment factory by TT?

For TT orders, the norm is a deposit up front with the balance paid against shipping documents (or after inspection), so your final payment tracks real, verifiable progress rather than a promise. The common structure is a 30% deposit to start production and 70% against a copy of the Bill of Lading.

Never agree to 100% upfront to a new supplier. Tie milestones to things you can verify: an approved sample before bulk, an inspection before the balance, documents before release.

What payment terms does Trishakti Apparel offer?

We work on staged terms: a deposit, then balances against inspection and shipping documents, with Letters of Credit for larger orders. And nothing reaches bulk until you’ve signed off a pre-production sample — so you’re never paying blind. It’s deliberately built so your money follows real progress.

Which payment red flags mean you should walk away?

Walk away from a supplier you don’t know if it demands 100% payment before production, wants payment to a personal account rather than the registered company, won’t provide a sample, video walkthrough or references, or pressures you to skip inspection or rush the wire. No legitimate factory requires 100% upfront.

• A demand for 100% payment before production, from a supplier you don’t know.
• Payment to a personal account rather than the registered company.
• No willingness to provide a sample, a video walkthrough, or references.
• Pressure to skip inspection or rush the wire.

Safe payment is really about verifiable milestones and a supplier with nothing to hide. That’s exactly how we like to work. More on how we earn buyer trust, or ask us about terms for your order.