On Monday, Bank of America announced it has extended its guaranteed foreign exchange rates for up to one year the longest duration offered in the industry. This move aims to reduce risks in cross currency transactions as trading volumes continue to grow.
By locking in a fixed foreign exchange spot rate, businesses can protect themselves from currency fluctuations and streamline key treasury functions like cash flow forecasting and reconciliation, the bank explained.
“Volatile FX markets make cash flow forecasting increasingly challenging for corporate treasurers,” said Daniel Stanton, head of transactional FX in Bank of America’s global payments solutions. “Offering longer guaranteed FX rates enables companies to improve their forecasting, which supports more informed decision-making.”
A significant portion of cross border payments comes from industries such as e-commerce, services, and manufacturing, the bank added.
