AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
The only way to be fully paid before goods leave the US is cash in advance, usually by wire transfer, which removes your credit risk but asks the buyer to trust you. If a Nigerian importer will not pay everything upfront, a confirmed letter of credit or a part-payment plus documentary collection are the usual middle grounds; open account is the riskiest for the seller.
Nigerian importers often want to pay as late as possible, and US sellers want to be paid before the container is loaded. Both are reasonable. The Nigerian side has its own constraints too: the buyer's bank handles foreign exchange through the Form M process, and how quickly dollars move depends partly on that bank.
The four ways to be paid
The US International Trade Administration's Trade Finance Guide ranks payment methods by risk. Here they are as they apply to a Nigerian buyer:
| Method | How it works | Risk to you | Risk to buyer |
|---|---|---|---|
| Cash in advance | Buyer wires full payment before you ship | Lowest | Highest |
| Letter of credit | A bank commits to pay when you present compliant documents | Low if confirmed by a bank you trust | Low |
| Documentary collection | Your bank sends documents via the buyer's bank, released against payment or acceptance | Medium | Medium |
| Open account | You ship and invoice; payment due in 30, 60 or 90 days | Highest | Lowest |
Cash in advance
The ITA says wire transfers and credit cards are the most common forms, with escrow services emerging for small deals. It also warns that insisting on full prepayment can lose you sales. A workable compromise with a new Nigerian buyer is a deposit at order (to cover your sourcing) and the balance before loading, with the bill of lading released only once the balance arrives.
For the buyer, an advance payment still goes through Form M. Sterling Bank's guidance distinguishes a Form M "Valid for FX", where the bank supplies foreign exchange, from "Not Valid for FX", where the importer uses its own domiciliary funds. Ask which your buyer is using, because it affects how fast the money can leave Nigeria; see what to do when Form M is delayed.
Letters of credit
Under a letter of credit, the buyer's bank promises to pay once you present documents that match the credit's terms. The ITA notes the buyer pays its bank for this, and that the credit is useful when you cannot get reliable credit information on the buyer but trust the bank. With a Nigerian issuing bank, many US sellers ask for the credit to be confirmed by a US or international bank, so the payment promise is also from a bank they know. The ICC describes its eUCP 2.1 as a supplement and digital companion to UCP 600, its rules for documentary credits, allowing credits to be handled digitally; check which rules your credit states.
The discipline is in the documents. Any discrepancy, such as a different description on the invoice and the bill of lading, can let the bank refuse payment. More detail: letters of credit from Nigerian banks.
Documentary collections
Your bank (the remitting bank) sends the shipping documents to the buyer's bank (the collecting bank), which hands them over only when the buyer pays at sight (documents against payment) or accepts a bill to pay on a set date (documents against acceptance). The ITA says collections are cheaper than letters of credit, but banks do not verify documents and offer limited recourse if the buyer does not pay. If the buyer walks away, your goods may be sitting in Lagos under your control but accruing port charges.
Open account
Open account is the most attractive to the buyer and, the ITA says, one of the highest-risk options for the exporter. Use it only for buyers with a long payment record, and consider export credit insurance.
Worked example: deposit and balance
Example only. Order value $40,000. The seller asks for a 30% deposit at order ($12,000) and the 70% balance ($28,000) before loading. The buyer's Form M is approved; the deposit arrives in week 1 and the balance in week 5. The seller loads in week 6 and releases the bill of lading on receipt of the balance. Total received before shipping: $12,000 + $28,000 = $40,000. The seller has carried no credit risk; the buyer has relied on the seller's reputation, so the seller shares its trade references and a verifiable company record.
What to agree first
- Payment method, deposit percentage and the balance trigger.
- Which bank issues or confirms any letter of credit.
- That the proforma matches the Form M and the final invoice.
- Who pays bank charges on each side.
- Before the first payment, verify the buyer; see verifying a Nigerian business.
Where Pryme fits
A Pryme Business Account gives you USD account details for deposits and balances, and the money stays in dollars until you choose to convert with Swap, which shows the rate and fee before you approve. Outside Nigeria, Pryme's activities are carried out through regulated partners.
Questions people ask
What is the safest way to get paid by a Nigerian buyer?
Cash in advance by wire transfer removes your credit risk. A letter of credit confirmed by a bank you trust is the usual alternative.
What is a documentary collection?
Your bank sends shipping documents to the buyer's bank, which releases them only against payment or acceptance of a bill. Banks do not guarantee payment.
Why is my Nigerian buyer's payment slow?
Payments go through the buyer's bank under Form M. Whether the Form M is valid for FX affects how the dollars are sourced.
Should I sell on open account to Nigeria?
Only to buyers with a strong payment history. The ITA calls open account one of the highest-risk options for exporters.
Sources
- International Trade Administration: Trade Finance Guide, methods of payment · accessed Oct 2026
- Sterling Bank: Form M frequently asked questions (modified 13 Mar 2022) · accessed Oct 2026
- ICC: eUCP Version 2.1 (29 Jun 2023) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.