Floes of financial assets also affect the balance of payments. When U.S firms, households, or governments borrow from overseas, funds flow abroad to the United States, resulting in a positive entry in the of payments U.S residents receive funds while the rest of the world receives an asset an IOU payable in the future similarly when the United States lends funds to the rest of the world the result is a negative entry in the balance of payments because funds flow out of the United States into the hands of overseas parties