Foreign currancy

Foreign currancy is a receivable on foreign money. It has several forms of expression, but the point is that it is not foreign cash, it is currency.

In a given country, all financial receivable expressed in the currency of another country (such as invoice, check, bills of bill of exchange) are considered foreign currency. This is true even if the receivable is against, say, a domestic bank, i.e. for example, we have a dollar account in a bank in a European country, and there is a certain dollar amount on it. 

It is advisable to distinguish foreign currency from foreign currencies, which is the cash embodiment of the same. So when we have dollars hiding in our drawer in our apartment in Paris, which we brought home from a business trip, then we have currency. The distinction is justified because the loss in foreign exchange is traditionally much smaller, i.e. the difference between the buy and sell rate used at the exchange is smaller. The explanation for this is to be found in the higher cost of holding cash. 

In addition, in order to reduce the difference in exchange rates, many international startup companies have been founded and operate successfully in recent times. Such fintech companies usually provide a universally accepted card alongside the service and work with extremely low fees in the field of international transfers. 

Frequently heard expressions in financial matters are the concepts of non-resident resident and foreign currency. There is no need to be afraid, in the case of private individuals, this essentially means that the person has or does not have an identity document valid in the given country. And in the case of companies, that the respective company is incorporated abroad. It is so good to know that a foreign branch office of a company that does not operate in the given country is considered non-resident, and vice versa, a branch office of a company registered abroad in a given country, is considered resident.