Andhra Bank Offers forward contract to its clients for covering their exchange rate risk emanating from various foreign currency transactions. Forward contract is a mechanism through which exchange rate is fixed in advance for purchase or sale of foreign currency at a future date. Forward contract is used for hedging the future risk arising out of exchange fluctuations in foreign currency transactions. By booking a forward contract, an exporter can determine the amount realizable on his export of goods in terms of home currency. Similarly, the importer can determine the cost of imports in terms of home currency. Similarly, it helps the debtors / creditors to hedge their exchange rate risk on foreign currency loans.