GLOSSARY

Swap

Swap (Foreign exchange swap) definition

A swap (also known as a foreign exchange swap or FX swap) is a financial transaction in which two parties exchange one currency for another and agree to reverse the exchange at a later date at a pre-agreed rate. It consists of two linked transactions: a spot transaction, where currencies are exchanged in the near term, and a forward transaction, where the currencies are re-exchanged at a future date.

Business relevance

FX swaps are commonly used by businesses and financial institutions to manage short-term foreign currency liquidity, hedge exchange rate risk, and align cash flows across different currencies. Because the initial exchange is reversed, swaps allow temporary access to a foreign currency without creating long-term exposure.

Effortless FX swaps and multi-currency management

With amnis, businesses can manage foreign exchange exposure more efficiently by accessing spot, forward, and swap transactions through a self-service platform. Automate FX workflows, optimise liquidity across currencies, and gain greater control with transparent pricing and 24/7 availability.

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Currency

A currency is a commonly accepted form of payment, typically issued by a government and used within its region. It serves as the physical representation of money, facilitating trade and financial transactions.

Currency exchange

Currency exchange is the process of converting one country’s currency into another, enabling international activities such as travel, trade, and investment. This can take place at physical locations like banks and exchange offices, or through digital platforms. Exchange rates fluctuate based on factors like market demand, economic indicators, and geopolitical events.

Foreign exchange

Foreign exchange (FX) is the global market for exchanging one currency for another. It enables international trade, investment, and travel by converting currencies through real-time exchange rates.

Key currency

A key currency is a stable and widely used currency in international trade and finance that serves as a benchmark for global transactions. It is often held as a reserve by central banks and used for pricing commodities, foreign exchange, and cross-border payments. The British pound, U.S. dollar, euro, and yen are widely considered key currencies.

Prime rate

The prime rate is the interest rate that commercial banks charge their most creditworthy customers, often large corporations. From a currency perspective, it reflects the cost of borrowing in a particular currency and serves as a key indicator of monetary policy. Changes in a country’s prime rate can influence capital flows, foreign exchange rates, and the overall strength or weakness of that currency in global markets.

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About amnis

amnis offers a comprehensive platform for international banking, offering a range of tools in one place. Transfer money abroad, exchange currencies 24/7 and collect international money transfer with your own IBAN accounts supporting 20+ currencies. Founded in 2014 in Zurich, amnis is a regulated payment institution under the supervision of the Banking Supervision Section in Liechtenstein (FMA) within the EEA.

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