December 11, 2019

Telegraphic Transfer Payment on Alibaba: How to Reduce Risks?

When you order goods from your supplier on Alibaba, you want to minimize risks and protect yourself from scammers. Among suppliers, Telegraphic Transfer Payment is one of the most popular payment methods. But do you know how safe it is for you, as for the buyer of the goods? Make sure you read this post first, so you’re guided!


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Why Should Amazon Seller Consider Telegraphic Transfer Payment on Alibaba?

T/T means Telegraphic Transfer, which is a type of a bank transfer. Currently, T/T Payment on Alibaba is the most common way of international bank transfers. Chinese suppliers often prefer it because bank commissions are relatively low.


 There are some of the advantages of using Telegraphic Transfer payment on Alibaba below:

  • Quick and convenient payments.
  • Widespread way of international money transfers.
  • Low bank fees.
  • Favorable exchange rate for Chinese suppliers.

What Are the Disadvantages of This Method of Payment for Orders?

  • It could take minimum of three working days.
  • Different weekends, holidays, and time zones could cause a delay in getting the funds.
  • When sending money for the goods in full, if you have any contentious issues, you will not be able to return them.
  • Even a small mistake in filling out the documents can lead to a significant delay in the payment. If the name of the beneficiary isn't typed in properly, the money will be withheld by the Chinese bank.
  • This method of payment is still considered quite risky, and therefore can only be used if the supplier has worked well with you more than once.

What Are Payment Options for a Batch of Goods Most Common Among Alibaba Suppliers?

100% T/T Pre-Payment

If you are just starting cooperation with a new supplier from China, you should not use this payment option! When you pay the full cost of the goods, you take too much risk.

Firstly, you may not receive your goods on time at all, because the supplier will delay the execution of your order in every way.

Secondly, even if the goods arrive on time, their quality may not correspond to what you expect. But you will not be able to influence this, because you paid for the goods. And proceedings involving third parties for an audit may take more than one month.

And the third, worst-case option is that you won’t get anything at all. That is, the supplier may simply disappear with your money, so you can be left with nothing.

We strongly do not recommend this method of payment

And even if you already know the supplier well, you previously ordered goods from him and think that he will never let you down, you should not rely on this. In order to protect yourself, we recommend using one of the T / T payment options, which we described below.

30% Deposit, the Rest 70% - Payment after Quality Control Inspection

This form of payment is commonly offered by Chinese suppliers. 30% - 70% is generally balanced and considered a fair transaction. With this method of payment for goods, you retain some leverage over the supplier. He is interested in making you satisfied with the transaction and the goods, and therefore this reduces the risk of receiving low-quality goods.

You pay 70% only after you receive documents confirming that the product meets your criteria and the shipment has been completed (bill of lading).

You may be able to negotiate with the supplier to reduce the down payment to 20%, and that will be great. However, you must understand that not every manufacturer will agree to this. If you order standard products that the supplier can sell to another buyer, if something goes wrong in the transaction with you, ask him before about reducing the down payment.

20% T/T Deposit, 40-50% - Payment after Quality Control Inspection, 30-40% -  Payment after Shipping

This is the most attractive payment option for the buyer. However, many sellers on Alibaba very rarely agree to it. But you can ask your supplier about this. You may be lucky in this matter.

The main plus of such payment is your maximum safety as a buyer. At the beginning you pay only 20%, which should partially cover the costs of the seller for the purchase of materials for the manufacture of your order. Then, when the goods pass the inspection for quality control, you pay another 40-50% of the total order. And only after the goods deliver in your country, you pay the rest of the money.

With this approach, you minimize the risk of getting low-quality goods. Even if the supplier cheated during the audit of the goods or tried to send you many defective units along with the consignment during loading, you will be informed about this upon arrival of the goods.

Note that if the manufacturer agrees to this payment option, it is most likely reliable.

If the Supplier Asks to Send Money to the Account of Another Company, Is This a Problem?

In fact, this practice is quite widespread in China. Suppliers do not always want to receive payments to their company accounts and use another company registered (most often) in Hong Kong for this. This is done, most often, for tax evasion. However, sometimes the merchants want to “collect” all payments and arrange delivery on behalf of another company simply for convenience. Another reason may be that they do not have an export license and cooperate with an export agent.

In both cases, the name of the company to which the account for the transfer of money is registered may not coincide (and most likely will be) with the name of the company of your supplier.

In any case, for you, as for the buyer, this has an additional risk. That will be more difficult for you to litigate from your supplier, as you cannot present a track of payments from your firm to theirs. And in case of disagreement, it will be much more difficult for you to prove to whom and why you transferred the money.

Here’s what you can do. Request both companies to sign a declaration. It should indicate that your supplier’s company asks another company to “collect” payments, arrange delivery, and perform other functions. At the same time, the names of both campaigns and the principle of their cooperation should be clearly spelled out in this agreement.

What Can I do if Something Goes Wrong with the Telegraphic Transfer (T/T) Payment?

Either you can wait for money to be returned to your bank account, or you can call your bank and present the right bank account details. The first option will take you at least 3 weeks. Meanwhile, the latter is quite costly, but it could save you weeks from waiting.


Always remember that when outsourcing your items to China, your mode of payment always matters. Telegraphic Transfer is a possible way when you are considering Bank Wire Transfer to China. However, you must protect yourself so as not to fall into the hands of fraudsters and not allow dirty manufacturers to deceive you. We hope that now you have all the information in order to make T / T payments safe and effective.