Plain-language definitions of 133 terms used in raw material trade: Incoterms, payment, shipping, customs, quality documents, plastics, metals, chemicals, agriculture and energy.
An arrangement in which the buyer’s payment is held by an independent third party – a bank, notary or licensed payment institution – until agreed conditions are met, such as confirmation of delivery or a satisfactory inspection report. Once the condition is met the money goes to the seller; otherwise it returns to the buyer. Simpler and cheaper than a letter of credit, it bridges the trust gap in mid-sized deals between new parties. Always verify that the escrow provider is genuinely licensed and independent.
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