cheque clearing period

silentscream999

hi,
the new 2-4-6 rule regarding cheques mean that a cheque paid in on monday must be available to withdraw on a thursday. So why do cheques paid into a halifax cardcash account take until friday to withdraw if you paid on monday morning.

surely this is against the law !?

MPH80

No - the bit you're missing is that it is working days *after* you've paid the cheque in.

So 4 working days after Monday is Friday, because Monday doesn't count.

http://www.apacs.org.uk/07_11_26.html

Difference is - most other banks offer a better service than 2-4-6.

M.

Mikeyorks

Halifax cheque clearance is 4 days - and that does include the day of payment (if before the cut off time). But yours isn't a standard current account and the inability to pay in over the counter is adding an extra day.

It's similar with cheques paid into a Savings account - that takes 6 days ... as the APACS link :-

These changes cover cheques, bankers’ drafts and building society cheques drawn on and paid into a UK current or basic bank account. For saving accounts the maximum time limit for withdrawal is longer (six days instead of four).

Scousebird_2

Under the 2-4-6 rule-if you put a chq in Monday it will be available for withdrawal and the funds will be 'cleared' a week on Tuesday...HOWEVER....Some banks will allow you to draw on the funds earlier at your own risk...if you trust thr person who paid you and you are certain it won't be returned (the cheque) then you can draw on it. Different banks have different clearance systems, but the timings are still the same-it still takes 6 full working days to clear-but some banks will offer customers an earlier withdrawral on the account based on account conduct and account type or in some banks, just for being a customer!

If you use the rule that if you pay in Monday it's available 1 wk Tues

Tues-avail 1wk Wed
Wed-avail 1wk Thurs
Thurs-avail 1wk Fri etc.

So patience is the key im afraid-cheques are a pain in my book!

YorkshireBoy

Scousebird,

Maybe I've misunderstood the 'new' 2-4-6 system, but for banks* the 'clearance' day is no different is it? I've always been able to draw on a cheque after 4 working days. I thought the only difference (at least for banks) was that you know for definite that the cheque won't bounce after 6 days...whereas pre-Nov 2007 it could be bounced some considerable time later?


* I appreciate that for smaller banks and most building societies the 'clearance' day is the same as the 'point of no return/can't be bounced' day, ie 6 days later making their system the 2-6-6 system...presumably because there are delays with clearing bank collection account processes?

Scousebird_2

This is correct-nothing has changed internally for the banks-after 6 working day-a cheque is cleared for fate and cannot be returned (unless the drawer or customer is party to Fraud at which point it can come back at anytime) so therefore nothing has changed-only difference is that if I write a Barclays Cheque from my account and I give it to my partner with HSBC-after 6 working days...this is ample time for Barclays to decide if I have the funds in the account to draw on-by the 6th day...my partner will have the funds because after 2 days...barclays have already looked at my account and decided that they can pay it-therefore after 6 days (allowing for the chq to be posted back to HSBC to say Refer to Drawrer) the funds either 'clear' or get 'returned' to start all over again.

I find this really helpful!!

http://www.apacs.org.uk/payment_options/APACS_246.swf

Enjoy!!

YorkshireBoy

Scousebird wrote: »

cleared for fate

That's the phrase I was looking for. Thanks for reminding me.

Scousebird_2

You're welcome YorkshireBoy!!! I have clearly been interested in the industry far too long-lol!

Mikeyorks

Scousebird wrote: »

Under the 2-4-6 rule-if you put a chq in Monday it will be available for withdrawal and the funds will be 'cleared' a week on Tuesday...HOWEVER....Some banks will allow you to draw on the funds earlier at your own risk

On that convention ..... it's 2-6. Which is rather mis-leading. Cheques clear in 3 days (the '4' allows them some latitude) ..... and all mainstream Banks allow funds withdrawal on current accounts after that (4 day) period - at the latest. The '6' is a new back stop to prevent Banks bouncing cheques at relative leisure .... unless fraud is involved. The '2' is a new discipline in order customers know where they stand on interest. It is the '4' which is the factor that has least changed.

As the routes and mechanisms through central Clearing haven't changed one iota. Banks still clear via their Clearing Centres overnight on Day 1. The cheques go via central Clearing on Day 2 .... and the electronic files / physical cheques to the drawer Bank for overnight on Day 3. No change.

So, the whole intention was simply to create a new set of rules .... engineered to avoid the Banks having to clear cheques faster. So it's in their own interests to make sure the new system works .. as it was designed as a placebo to avoid a spend of £millions in upgrading the current Clearing system against a backdrop of reducing cheque volumes.

Scousebird_2

Now you see I reckon you're point is indeed valid-where the 4 comes in. is that in some banks they will allow you to draw on the chq on day 3/4, and even if you have spent the money and the chq is still returned unpaid then it won't be debited and the bank will accept it. I believe this may happen in some banks-so really...the 2-4-6 was invented to have some sort of regularity and transparency for customers to understand-rarther than the confusion of the past-where pretty much no-one knew what they were getting, when etc.

Sorry about rambling [EMAIL="!!!!-it's"]!!!!-it's[/EMAIL] been a long day!