Agricultural Import & Export Industries
Agricultural Businesses Run The Risk of Significant Losses
Central Bank’s Basic Payment Scheme (BPS).
Support at Each Stage of The BPS Process
Receiving The Subsidy in Sterling
Research & Analytics
If they opt to receive the subsidy in sterling, payment will be made based on the rate of currency exchange calculated based on the average of ECB rates that September.
However, even after the May deadline, Currency Hedger can implement a hedge on their behalf, so they can control the amount of sterling they receive.
Receiving The Subsidy in Euros & Pound
If they opt to receive the subsidy in euros instead, however, they can either:
Change it into euros using Currency Hedgers Exchange rate on the day the payment is received.
This is likely to be a more competitive exchange rate than the ECB rate, but does mean that the funds are subject to that rate – meaning they could lose out due to the continually fluctuating markets and the possibility that the rate had fallen on that day. They will also be unaware of exactly how much they receive until the day that payment is made.
Creating a Bespoke Solution
Book a Forward Contract at any point in the year before the payment is received. This allows them to reserve a favourable rate to exchange the euros into sterling upon receipt of payment; ensuring they know exactly how much sterling they will receive in advance avoiding any negative currency market movements allowing them to budget accordingly.
Through discussing these potential strategies and creating a bespoke solution for every client, Smart Currency Business assists agricultural clients in securing a favourable exchange rate before the BPS exchange rate is set in September, whether they receive payment in sterling or euros. This gives clients more control over the amount they receive and enables them to plan ahead.
Specialist currency strategies and business guidance for the agriculture sector, including specific BPS support.
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