Nostro and vostro accounts
A nostro account is an account a bank holds at another bank, usually abroad and in that country's currency. A vostro account is the same account seen from the bank that holds it. Nostro means "ours" and vostro "yours" in Italian. These accounts are how money settles in cross-border payments.
One account, two names
Say a Finnish bank needs to pay US dollars. It opens a USD account with a bank in New York. The Finnish bank calls it its nostro ("our money with you"). The New York bank calls the same account a vostro ("your money with us"). Bankers sometimes use a third term, loro ("theirs"), when talking about an account a third bank holds.On the Finnish bank's books, the nostro balance is an asset. On the New York bank's books, the vostro balance is a liability it owes to its client bank.
How they move a payment
When the Finnish bank's client sends USD to a supplier in Texas, no dollars cross the Atlantic. The Finnish bank instructs its correspondent bank in New York to debit its nostro and credit the supplier's bank, directly or through another US bank. Swift messages, such as the MT103 or its ISO 20022 successor, carry the instructions. The money only moves between accounts inside the US.Because the bank must keep enough money in each nostro to cover outgoing payments, nostro accounts tie up liquidity in many currencies. Large banks spend real effort forecasting and reconciling them.Why it matters to a business
You never see the nostro chain, but it decides three things you do see:- the fees, because each bank in the chain can deduct a charge, depending on the OUR, SHA or BEN option you chose
- the timing, because every hop adds cut-off times and compliance checks
- where a payment stops: a payment held "at the intermediary" is sitting between two of these accounts, and SWIFT GPI tracking shows which one
FAQ
Very close. A correspondent account is the general term; nostro and vostro say whose side you're looking from.
Some hold accounts with banks for settlement and safeguarding, but they reach Swift in different ways. The terms come from banking and are used loosely outside it.
Modern bookkeeping grew up in Italian merchant banking, and the terms stuck.
Related terms and sources
Correspondent bank · SWIFT GPI · MT103 · OUR, SHA and BEN · BIC code · Browse the full glossary
Last reviewed October 21, 2026Disclaimer
This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Narvi Payments Oy Ab or its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Narvi Payments Oy Ab or its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
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