Spot Rate

A Spot Rate is the current price at which a commodity can be bought or sold at a specific time and place. Bidvest Bank can provide spot exchange rates for immediate foreign exchange payments by quoting an exchange rate for a payment (e.g. US Dollars) where this rate remains valid for two business days.

Forward Exchange Contracts (FECs)

A FEC is a contract between a client and Bidvest Bank to exchange a specified amount of one currency (the client’s import requirements) for another currency (what the client will pay Rand) on a specified future date or between specified future dates at an exchange rate agreed to at the time of entering into the contract.

FECs fix the price of foreign currency payments that are expected to materialise at a future date. These contracts have a level of flexibility and amounts and delivery dates can be tailored to meet your requirements.

FECs:

• Protect you from unfavourable movements in future spot rates
• Eliminate adverse currency movements beyond the agreed forward rate
• Keep your future cash flows certain and predictable