Bank Cheques Clearance Time

hansi

We are constantly hearing of how long it takes banks to clear cheques these days. However, I have to take my hat off to Smile. I paid in two cheques at my local Co-op Bank on Thursday afternoon (26 Oct) and they show as cleared on my account this morning (28 Oct) and it's a Saturday!! Can't ask for better than that can you?

JohnPeard

hansi wrote:

We are constantly hearing of how long it takes banks to clear cheques these days. However, I have to take my hat off to Smile. I paid in two cheques at my local Co-op Bank on Thursday afternoon (26 Oct) and they show as cleared on my account this morning (28 Oct) and it's a Saturday!! Can't ask for better than that can you?

It shows that the technology is out there to enable credits to be cleared efficiently.
Despite all the nonsense spouted by other high street banks that it takes 3 to 4 working days to clear cheques and on-line transactions, they could implement a two-day clearance now, if they so desired.

They won't, because they make oodles of dosh through unpaid DD and cheque fees.

At some point they will of course, having been dragged kicking and streaming by consumers, OFT etc.

The technology exists to handle debits from an account in real-time (ATM machines are a good example) but credits are handled (we are told) by overnight batch-processing methods.

Another point is, what is this 'working day' nonsense? Banks charge interest on Sat , Sun and Bank holidays, most transactions now (i.e via credit and debit cards) are on-line 24/7, the banks don't turn off their modems on a friday night, so whay are we still stuck in the 1920's?

grumble, grumble, winge, winge.....

[Deleted User]

my main account is with smile but it is a train ride away so I have a small account with lloyds. The last two cheques I deposited with lloyds took 6 days each to clear. I take my hat off to smile and I go there to deposit larger cheques

Mikeyorks

There may be an entry in your account .. but it's not 'cleared' funds. Which takes a minimum of 3 days for a cheque. Even if you pay into your Branch - and the entry is there immediately - it's not 'cleared'. The process is controlled by APACS, it's not negotiable nor can it be short circuited. Even 'special presentation' doesn't do that.

Some banks will insert an entry on your account earlier, some will pay interest earlier .. but it's still not 'cleared' funds. And I'm not aware that Smile do either of those? pdf showing the 3 day cycle (and the extra day / 2 days - thereby making it 4/5 days - added by most Banks is to allow dishonoured cheques to circulate back) is here - note the green box at bottom right re 'commercial decisions'

http://www.apacs.org.uk/payment_options/documents/Cheque_Clearing_Cycle_diagram.pdf

saichia

If you have a lloyds tsb account and you pay in a lloyds cheque, it will clear as soon as you pay it into your account

Mikeyorks

saichia wrote:

it will clear as soon as you pay it into your account

It will not.

Lloyds will pay interest on it (if paid in their Branch - and under £1000) - but it has not given you cleared funds. Might be a subtle difference - but it's very significant. If you look at my earlier post - this is the 3 days in the Lloyds quote :-

Start earning interest on cheques instantly when they are paid into your Lloyds TSB interest paying personal current account, as long as they are paid in over our counters between 9am-4:30pm weekdays and total less than £1000 a day.

Keep earning interest when you pay out. It can take up to three working days for your payment to get to where it needs to. We’ll keep paying you interest right until the moment it gets there.

lamb7994

I think saicha was meaning if you pay a Lloyds TSB cheque into a lloyds Tsb account it appearently clears the next day.

J

Mikeyorks

Thanks and I do agree. But it's the 'apparently' that can make a lot of difference. When I pay a cheque into my Halifax account is shows instantly - but draw on those funds .... and you're overdrawn. With the attendant charges that can bring.

Which is why I get a bit terse with people disregarding the difference between 'visible' and 'cleared'. As it can be expensive

hansi

Mikeyorks wrote:

There may be an entry in your account .. but it's not 'cleared' funds. Which takes a minimum of 3 days for a cheque. Even if you pay into your Branch - and the entry is there immediately - it's not 'cleared'. The process is controlled by APACS, it's not negotiable nor can it be short circuited. Even 'special presentation' doesn't do that.

Some banks will insert an entry on your account earlier, some will pay interest earlier .. but it's still not 'cleared' funds. And I'm not aware that Smile do either of those? pdf showing the 3 day cycle (and the extra day / 2 days - thereby making it 4/5 days - added by most Banks is to allow dishonoured cheques to circulate back) is here - note the green box at bottom right re 'commercial decisions'

http://www.apacs.org.uk/payment_options/documents/Cheque_Clearing_Cycle_diagram.pdf

I beg to differ. Smile show a "balance" and an "available balance". On the Friday the amount paid in on the Thursday was shown as deposited but not available. On the Saturday.it was in my "available" balance. So it is cleared!

hansi

kittie wrote:

my main account is with smile but it is a train ride away so I have a small account with lloyds. The last two cheques I deposited with lloyds took 6 days each to clear. I take my hat off to smile and I go there to deposit larger cheques

A train ride away? Smile is an online bank!

hansi

Mikeyorks wrote:

Thanks and I do agree. But it's the 'apparently' that can make a lot of difference. When I pay a cheque into my Halifax account is shows instantly - but draw on those funds .... and you're overdrawn. With the attendant charges that can bring.

Which is why I get a bit terse with people disregarding the difference between 'visible' and 'cleared'. As it can be expensive

No so with mine. I rang and checked with Smile and they said I could draw on it immediately.