Following are International Payment Terms ranked in order of lowest to highest risk to seller:

Cash in Advance

Usual Time of Payment: Before shipment.
Goods Available to Buyer: After Payment.
Risk to Seller: None.
Risk to Buyer: Complete – requires the seller to ship exactly the goods expected, as quoted and ordered.

Confirmed Irrevocable Letter of Credit (CILC)

Usual Time of Payment: After shipment is made; documents presented to the bank.
Goods Available to Buyer: After Payment.
Risk to Seller: Commercial invoice must match terms of L/C exactly. Gives the Seller a double assurance of payment.
Risk to Buyer: Assures shipment is made but relies on exporter to ship goods as described in documents.
Comments: The inclusion of a second assurance of payment (usually a US bank) prevents surprises, and adds assurances that issuing bank has been deemed acceptable by confirming bank. Adds cost and an additional requirement to seller.

Unconfirmed Irrevocable Letter of Credit (ILC)

Usual Time of Payment: Same as above.
Goods Available to Buyer: Same as above.
Risk to Seller: Seller has single bank assurance of payment and seller remains dependent on foreign bank.
Risk to Buyer: Same as above.
Comments: If unpaid, becomes open account with buyer’s bank as collection agent.

Sight Draft (with documents against acceptance)

Usual Time of Payment: On presentation of draft to buyer.
Goods Available to Buyer: After payment to buyer’s bank.
Risk to Seller: If draft is not honored, goods must be returned or resold. Storage, handling, and return freight expenses may be incurred.
Risk to Buyer: Assures shipment but not content, unless inspection is allowed before payment.
Comments: Seller is essentially drawing a check against the buyer’s bank. Buyer’s bank must have pre-approval, or seek approval of buyer before honoring the check.

Time Draft (with documents against acceptance)

Usual Time of Payment: On maturity of the draft.
Goods Available to Buyer: Before payment; after acceptance.
Risk to Seller: Relies on buyer to honor draft upon presentation.
Risk to Buyer: Assures shipment but not content. Time of maturity allows for adjustments, if agreed by seller.
Comments: Payable based upon the acceptance of an obligation to pay the seller at a specified time. Although a time draft has more collection leverage than an invoice, it remains only a promissory note, with conditions.

Open Account

Usual Time of Payment: As agreed, usually by invoice.
Goods Available to Buyer: Before payment.
Risk to Seller: Relies completely on buyer to pay account as agreed.
Risk to Buyer: None.