cheques

imasmartie22_2

hi everyone
not sure were to put this so decided to put it here.
I have a friend that gave a cheque out to cover a bill on monday last week, [she gave it direct to person concerned]
by tuesday [of the same week] at 3 pm llyds ahd bounced the cheque, [she works nights so dint transfur the money till she got home which was early hours of wednesday morning.
the person who recived the cheque banks with Nationwide.
[she also asked the question if she had paid to have the cheque cleared quicker she didnt get a reply]
lloyds have said they wont charge on this occassion?
has got a clue what clearnce times should be?
im with lloyds and unless cheques are lloyds to lloyds mine take at least 4 days to clear?:o:beer:

meer53

If your friend issued a cheque and money wasn't in the account to cover it, it will bounce. You don't have 4 days to pay money in to cover it, thats not how it works. The person who is given the cheque pays it in to their account, the next day, the bank it's drawn on will check the balance of the account it's coming from. No money, no pay.

lolavix

from_the_Lloyds_website wrote:

Cheque Clearing Process
Cheques go through a clearing process so the amount you pay in may not be available to use straight away. We meet the requirements of the 2-4-6 cheque clearance process implemented by all UK banks and building societies. The 2, 4 and 6 refer to the number of working days after a cheque has been paid into an account. Working days are Monday to Friday, except bank holidays. This is how the process works if you pay in a sterling cheque from another bank:

We will show the cheque in your account on the same day that we receive it;
From the second working day after we receive it, we start paying interest on the cheque (or using it to reduce the interest you pay);
From the fourth working day after we receive it, the funds are available for you to use but the cheque may still need to be returned unpaid up until the sixth working day after we receive it; and
From the end of the sixth working day after we receive it, if the cheque is returned unpaid by the paying bank, we cannot take the money from your account without your consent unless you have acted fraudulently.

It is unusual to debit that quickly, but they could have paid it in on Monday afternoon. The 4th day is the day the funds are normally available to the payee, so can debit the payer before that.

It's a lesson learned that you should not write cheques without having cleared funds available.

[Deleted User]

Hi,

this is also from LTSB, seems if LTSB cheque paid into LTSB branch things happen quicker.

If you have a Lloyds TSB cheque to pay in then things are slightly quicker. If the cheque is coming from:

• A personal account, we will show it in your account, pay interest on it (or use it to reduce the interest you pay) and allow you to withdraw the funds on the same day that we receive it.
• A business account and you pay the cheque into the branch holding that account, we will show it in your account and pay interest on it (or use it to reduce the interest you pay) on the same day that we receive it and it will be available for you to use the next working day. If you do not pay in the cheque at the branch holding the business account, we will deal with it in the same way as a cheque from a non-Lloyds TSB account.

imasmartie22_2

thank you she did have the funds they were in her saving account gess she went off to work and forgot, to do it straight away,
but true gess banks have rules to suit themselves, if i pay a cheque in have to wait four days [not saying by issuing one you except to wait that long before you put the money in to cover it the money should be there]
just strange rules

lolavix

imasmartie22 wrote: »

thank you she did have the funds they were in her saving account gess she went off to work and forgot, to do it straight away,
but true gess banks have rules to suit themselves, if i pay a cheque in have to wait four days [not saying by issuing one you except to wait that long before you put the money in to cover it the money should be there]
just strange rules

She may have had the funds, but they were not in the correct account.

Sorry the second half of your post confused me - the four days is the time it takes to get through the clearing cycle and show as available funds, nothing to do with the banks suiting themselves

imasmartie22_2

yes but if it takes 4 days for my cheque to clear then what is the reason the banks give for cashing a cheque within a 24 hour period, "so to the banks suit themselves"
because you work for a bank sometimes you dont always get things right she was wrong regurding funds, but that still dont explain why funds cleared so quickly,
put another way if she had put a cheque into her account it will take 4 days?
"whats the difference"

lolavix

I didn't say I was right, I was trying to explain how the clearing cycle works, but you obviously don't understand it.

The difference is one is a cheque in and one is a cheque out - the debit will happen before the credit. The money has debited her account the next day because the person she was paying obviously paid the cheque in on the Monday - the person she was paying will not have available funds until day 4.

alanq

According to the following, with the normal clearing cycle the balance of the drawer is checked two days after cheque enters the system.
http://www.chequeandcredit.co.uk/information/-/page/the_cheque_clearing_cycle/

I seem to recall that there is no longer express clearance but that, for a fee, a payee can get their bank to check almost immediately if a cheque is good. Perhaps that what happened in this case.

lolavix

It can also happen slightly quicker if the cheques are within the same bank - I've been caught out myself before by forgetting to transfer money. I don't think checking it will be cleared makes it any faster, as from what the cashiers have told me before - they rely on Royal Mail to get the cheque back to the originating back (I may be wrong on this though as never dealt with it!)