Available Balance

AAA

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.

INVESTOPEDIA EXPLAINS '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.

RELATED TERMS
  1. Business Day

    A measurement of time that typically refers to any day in which ...
  2. Electronic Check

    A form of payment made via the internet that is designed to perform ...
  3. Checking Account

    A transactional deposit account held at a financial institution ...
  4. Account Balance

    1. The amount of money in a financial repository, such as a checking ...
  5. Float Time

    The amount of time between when an individual writes and submits ...
  6. Deficiency Balance

    The amount owed to a creditor if the sale proceeds from the collateral ...
RELATED FAQS
  1. How does your checking account affect your credit score?

    Your credit report provides a snapshot for prospective lenders, landlords and employers of how you handle credit. For any ... Read Full Answer >>
  2. What is the banking sector?

    The banking sector is the section of the economy devoted to the holding of financial assets for others, investing those financial ... Read Full Answer >>
  3. What's the difference between a letter of credit and a bank guarantee?

    Bank guarantees represent a more significant contractual obligation for banks than letters of credit do. A letter of credit ... Read Full Answer >>
  4. How do leverage ratios help to regulate how much banks lend or invest?

    Banks are among the most leveraged institutions in the United States; the combination of fractional-reserve banking and Federal ... Read Full Answer >>
  5. Can I use a prepaid credit card to pay bills or to transfer money to other accounts?

    Prepaid credit cards may be used to both pay bills, either as a one-time transaction or recurring transaction, and to transfer ... Read Full Answer >>
  6. What’s the difference between overdraft protection and overdraft settings?

    Overdrafting refers to the practice of granting short-term credit to an account holder when his or her balance reaches zero. ... Read Full Answer >>
Related Articles
  1. Savings

    Are Your Bank Deposits Insured?

    Learn how the FDIC is helping to keep your money in your pockets.
  2. Budgeting

    The Beauty Of Budgeting

    Make it to the end of the month, before you run out of money.
  3. Options & Futures

    Increase Your Disposable Income

    Here are four quick and easy ways to up your spending money.
  4. Insurance

    Your First Checking Account

    This owner's manual will show you what to expect from your bank.
  5. Savings

    All About Banking

    This tutorial will tell you everything you need to know about how checking and savings accounts work.
  6. Budgeting

    Save Without Sacrifice

    Don't sacrifice your life for your savings - get out there and have fun!
  7. Economics

    Understanding Term Loans

    A loan from a bank for a specific amount that has a specified repayment schedule and a floating interest rate.
  8. Economics

    Explaining Tier 1 Capital

    Tier 1 capital refers to the core capital a bank must maintain in relation to its assets.
  9. Credit & Loans

    What's a Revolving Line of Credit?

    A revolving line of credit is an arrangement made between a company or an individual and a bank to borrow money on a short-term basis.
  10. Savings

    Explaining Checking Accounts

    A checking account is an account at a financial institution, usually a bank, that allows for deposits and withdrawals.

You May Also Like

Hot Definitions
  1. Mixed Economic System

    An economic system that features characteristics of both capitalism and socialism.
  2. Net Worth

    The amount by which assets exceed liabilities. Net worth is a concept applicable to individuals and businesses as a key measure ...
  3. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  4. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  5. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center