What is a bill of lading?

A bill of lading (BOL) is a document issued by a carrier to a shipper confirming the goods were received in an acceptable condition and are ready to be shipped. A BOL is essentially a contract between the shipper, receiver and carrier stating the terms and conditions of the carriage.

Some customers choose the bill of lading as a payment guarantee of goods. When this method of payment is used, the bill of lading is the official shipping document to obtain payment, transfer of ownership and release of funds by the bank to the shipper once the goods have been received by the recipient.