Which best describes the role of a correspondent bank in international payments?

A correspondent bank primarily serves to facilitate payments between banks that do not share a direct relationship, especially in the context of international transactions. This means that when two banks lack a clearing agreement or established network for direct exchanges, a correspondent bank steps in to handle the payment processing on behalf of one or both of the involved banks.

This role is crucial for enabling cross-border transactions because it provides a necessary link that allows the remitting bank to send funds and the receiving bank to collect them. The correspondent bank manages the currency conversions and ensures that the funds are transmitted correctly and efficiently between different banking systems and geographic locations.

The other options do not accurately capture the correspondent bank’s vital function. While it's true that a correspondent bank can act in a neutral capacity, its primary financial interest is in ensuring the smooth transfer of funds rather than merely mediating without interest. Additionally, the correspondent bank does more than just provide security for the remitting bank; it actively facilitates transactions by managing relationships and payment flows. Finally, the correspondent bank does not directly manage customer accounts; that role is typically reserved for the local banks themselves.