Payment is made to the Exporter either at sight, or on maturity of a term bill; both less charges due.

If payment is refused
Although there is a contractual arrangement between Importer and Exporter, the Importer cannot be forced to pay by a bank under the Documentary Collection.

If payment is refused when the documents are to be released on payment (ie. at sight)
If the Importer refuses payment, the Presenting/Collecting Bank advises the Remitting Bank and therefore the Exporter, and asks for their further instructions. Documents are held by the Presenting/Collecting Bank to the order of the Remitting Bank.

The Presenting/Collecting Bank may arrange 'Protest' (or other Legal process) of the Bill of Exchange if the Exporter stipulated this on the schedule.

If acceptance is refused when the documents are to be released on acceptance
If the Importer refuses acceptance, see above.

If accepted and not paid on the due date
The Bill of Exchange may have been accepted, but then payment is refused on the due date. However the documents will have been released to the Importer upon acceptance. The Presenting/Collecting Bank will then advise the Remitting Bank and ask for further instructions.

Avalisation
In order to avoid the above, the Exporter may wish to consider asking that documents be released against the Importer's acceptance of the Bill of Exchange and a guarantee of payment from the Presenting/Collecting Bank. This is called Avalisation.

We recommend that if payment is refused, the two parties try to resolve the matter between them, whether the concerns are contractual or relating to the goods themselves.

We would strongly recommend that anyone who is dealing with documentary collections refers to the Uniform Rules for Collections (URC).