Why acceptances are used in international trade

Acceptances are used in the important and export trade because most exporters are uncertain of the credit standing of the importers to whom they ship goods. Exporters may also be concerned about businesses conditions or political developments in foreign countries. Nations experiencing terrorist violence or even civil war have serious problems in attracting financing for imports of goods and services because of the obvious risks carried by businesses extending credit to them. However, exporters usually are quite content to rely upon acceptance financing by a foreign bank.