DEFINITION of 'Available Balance'

Balances in checking or on-demand accounts where there is a delay in crediting funds to an account. If a check deposit has not been cleared by the issuing bank, the funds will not be available to the account holder even though they may show up in the account's stated total funds.

The net effect is that the account balance may be different from the balance that is available to the account holder for spending, withdrawal or transfer.

BREAKING DOWN 'Available Balance'

Depending on both the issuing bank and the receiving bank's policies, check deposits may take anywhere from two to five days to clear if both banks are domestic. This process may take much longer if the check is drawn on a non-bank institution or a foreign institution.

The bank's policy may have nothing to do with when the funds are actually released to the bank itself. The time between when a check is deposited and when it is available is often called float time.

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