What is Foreign Exchange Management?

Foreign exchange management differs from foreign exchange risk management in as much it is the management of the exposures created and the actual management of the various currencies purchased or received and the relevant payments.

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Learn more about Foreign Exchange Management

In a firm which imports from and exports to various parts of the world and has multiple customers in those locations, the administration of the various payments and receipts needs to be matched with the amounts of currency bought and sold. The FX manager will ensure that the boards hedging policy is completed and will ensure that payments and receipts in the same currency are matched to ensure efficient management of the firm’s currency exposure.

Where a firm is making net payments to its suppliers on a (say) monthly basis, the FX manager will ensure the availability of the currency and create the instructions to make the relevant payments. They will also monitor receipt of funds from customers to ensure that they comply with the dates on which the currency is to be delivered to the payment provider.

A close relationship with a firm like CurrencyTransfer.com is essential to build trust and ensure that the firm’s suppliers receive their payments on time and receipts of funds are handled professionally.