The current account (or current balance) is a component of the balance of international payments. The current account records transactions in goods, services and investment income.
The balance of international payments (international balance) is understood as a systematic statistical record of transactions of goods and services of a country carried out by individuals, resident businesses or by the Government of that country.
The balance of international payments is made up of the following components: Current Account, Capital Account, Changes in State Foreign Exchange Reserves and Error Items.
Illustration
Transactions recorded in the current account include:
- Transactions on goods: usually tangible assets such as machinery, televisions, refrigerators...
- Service transactions such as insurance, tourism , transportation, telecommunications...
- Sources of income such as salaries of residents paid by non-residents, income from direct investment, remittances from abroad and interest paid on foreign debts.
- One-way current transfers such as donations, gifts, non-refundable aid...
The current account or current balance is made up of the following components: balance of trade in goods, balance of trade in services, balance of income and transfers.
Benefits of current deposits
Earn interest on account balance.
Open an account in one place and trade in many places.
Safe, accurate, and absolutely secure in payment transactions.
Can be used in excess of the account balance when participating in overdraft products.
Using non-cash payment methods meets the needs of speed, safety and convenience.
Use online banking services (Internet Banking and HomeBanking) to make payments/transfer money/update instant information on transaction history, sub-ledger, query exchange rate/interest rate information...
Minh Huong (synthesis)
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