How Do I Get Paid? (Methods of Payment)
As Panama is an international banking center, there are a number of payment options for Panamanian importers. U.S. suppliers often demand irrevocable letters of credit when making overseas sales and these are readily provided by the local banking system. Bank drafts are also available at very reasonable cost. The local banking system is modern and efficient and payments have not represented an issue for Panamanian importers.
U.S. exporters may be able to gain a competitive advantage through the use of open account terms coupled with export credit insurance. The terms allow Panamanian buyers to take receipt of goods and sell them in order to obtain the needed cash to repay the U.S. exporter. In the event of default, the export credit insurance would make the U.S. exporter whole.
For more information on gaining a competitive edge through offering financing to buyers in Panama, please review our guide on Getting Paid by Your Latin American Buyer here: http://export.gov/panama/financingexporttopanama. This guide is published in English and in Spanish, so that you can share it with potential Panamanian buyers.
Several banks operating in Panama have longstanding relationships with the Export-Import Bank of the United States, which is the leading issuer of export credit insurance to U.S. exporters, and can help you assess the creditworthiness of a Panamanian buyer. In addition, the CS Panama office can conduct background checks as part of a Business Facilitation Service for any Panamanian buyer before you decide to offer financing terms.
How Does the Banking System Operate?
The U.S. Dollar is Panama’s currency and there is no central bank. The National Bank of Panama has certain functions of a central bank, such as serving as the clearinghouse for the banking system.
Panama opened its banking sector to foreign competition in 1970 under legislation which placed high priority on banker-depositor confidentiality. In early 2012, there were 91 banks registered in Panama with total assets of $81.7 billion. The banking legislation establishes three classes of operations. General license banks operate full service banks in Panama and compete for domestic and foreign deposits and loans. International License or "Offshore" banks, can only accept deposits from persons or organizations located overseas. Representative Offices can only perform representational activities. There are also two state-owned deposit-taking institutions. Foreign and Panamanian banks compete on equal terms. Banks are organized into the Panamanian Banking Association (Panamanian and Foreign Banks) and are licensed and regulated by the Banking Supervisory Authority (Superintendencia de Bancos). Panama’s banking system does not have a deposit insurance scheme.
For more details on:
U.S. Banks and Local Correspondent Banks