Discusses the most common methods of payment, such as open account, letter of credit, cash in advance, documentary collections, factoring, etc. Includes credit-rating and collection agencies in this country. Includes primary credit or charge cards used in this country.
Last Published: 4/17/2016
Most local businesses operate on a cash basis. Import and export letters of credit as well as electronic funds transfer are available at several banks.  Due to wide mistrust and general underdevelopment of the banking system, many local businesses depend on the informal hawala system to make payments and transfer funds.  The hawala system is an informal value transfer system whereby money is transferred through a network of brokers, or hawaladars.  Promissory instruments are not exchanged; the transaction is based on the honor system.
 
Many U.S. firms exporting to Afghanistan require cash payment in advance, made by wire transfer, before shipping to Afghanistan.  Foreign businesses dealing with Afghanistan should insist on confirmed, irrevocable letters of credit (L/Cs) when initiating relationships with new importers and distributors.  U.S. firms should be cautious about agreeing to L/Cs terms that require onsite inspection certificates as it may be difficult to get Afghan officials to complete cargo inspection certificates, or other forms, required to meet L/Cs documentation requirements needed for release of payment.

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



Afghanistan Market Access Payment