The process is that banks collect local currency at home and pay foreign exchange abroad. Because its remittance direction is consistent with the flow of funds, it is called shun remittance. Under the forward remittance mode, customers use their own currency to buy bills from foreign exchange banks, which is equivalent to the bank selling foreign exchange. (1) the remitter, usually the debtor or payer;
(2) The payee refers to the creditor or beneficiary.
Remittance bank is a bank entrusted by the remitter to remit money to the payee;
(4) The paying bank refers to the bank entrusted by the remitting bank to receive the remittance from the remitting bank and remit the money to the payee, also known as the remitting bank.
The relationship between remittance bank and payment bank is principal-agent relationship. After the bank collects local currency and sells foreign exchange, it will notify the creditors or branches of the country where the payee is located or their correspondent banks by means of telegraphic transfer, letter transfer and draft according to the customer's requirements, and pay a certain amount of foreign exchange in his foreign currency deposit account to the payee at the exchange rate of the day. In this way, foreign exchange banks have increased the local currency paid by customers in their own accounts, while the deposits in foreign currency accounts have decreased the corresponding foreign currency. According to the different delivery methods, spot foreign exchange transactions can be divided into three types.
TelegraphicTransfer (T/T/T) is short for telegraphic transfer. T/T by bank is a remittance method in which the remitter directly notifies the overseas remittance bank by telegram or telex and entrusts it to pay a certain amount to the payee. The telegraphic transfer delivery method is to notify the foreign exchange buyer and seller's bank (or the entrusted bank) to collect the transaction amount by telegram or telex. A telegraphic transfer voucher is a telegram or telex remittance power of attorney from the remittance bank or trading center.
The delivery method of draft is called sight draft, or D/D/D for short. Bank selling tickets refers to a remittance method in which the remitter opens a draft issued by a foreign remitter at the application of the remitter, and the remitter sends it to the payee or personally carries it to the payee, and draws money from the remitter with the draft. Bill delivery refers to remittance and collection by opening bills of exchange, promissory notes and checks. These bills are evidence of the draft.
Mail delivery mode, referred to as mail delivery. Bank selling is a remittance method in which remittance banks directly notify foreign remittance banks to entrust them to pay a certain amount to the payee by letter at the application of the remitter. Remittance means to inform the foreign exchange buyers and sellers of the deposit bank or entrust the bank to collect and pay the transaction amount by letter. Remittance voucher is the remittance payment power of attorney of remittance bank or trading center. For foreign exchange banks, under the reverse exchange mode, customers sell bills to banks, which is equivalent to banks paying local currency and buying foreign exchange. After accepting the collection entrustment of the payee, the foreign exchange bank shall notify its foreign branches or correspondent banks to collect a certain amount of foreign currency from the payer at the exchange rate of the day and deposit it in its foreign exchange account opened in a foreign bank. Therefore, the balance of the domestic local currency deposit account of the bank decreased, while its foreign currency deposit account increased the corresponding foreign currency amount.