Clearing House Funds

AAA

DEFINITION of 'Clearing House Funds'

Money that passes between Federal Reserve Banks in the form of personal or business checks prior to approval of credit. These funds are in the process of clearing and reconciliation through a central processing mechanism. Because of this, they are often not available for withdrawal on the day of deposit.

INVESTOPEDIA EXPLAINS 'Clearing House Funds'

Clearing house funds differ from federal funds, which settle on the same day. Because clearing house funds are not drawn on reserves like federal funds, they generally take at least three days to clear. Clearing house funds are also used to settle any transaction on which there is one day's float.

RELATED TERMS
  1. Float

    Money in the banking system that is briefly counted twice due ...
  2. Federal Reserve Bank

    The central bank of the United States and the most powerful financial ...
  3. Check Routing Symbol

    A set of numbers appearing as the denominator of a fraction that ...
  4. Clearing House

    An agency or separate corporation of a futures exchange responsible ...
  5. Bank

    A financial institution licensed as a receiver of deposits. There ...
  6. Federal Funds

    Excess reserves that commercial banks deposit at regional Federal ...
Related Articles
  1. Insurance

    Your First Checking Account

    This owner's manual will show you what to expect from your bank.
  2. Options & Futures

    Choose To Beat The Bank

    From internet banking to credit unions, it's in your power to cut fees and maximize service.
  3. Investing

    What does CHIPS UID mean?

    CHIPS UID stands for Clearing House Interbank Payments System Universal Identifier. This is just a fancy name for an electronic clearinghouse database system, which facilitates the transfer of ...
  4. Personal Finance

    Cut Your Bank Fees

    Find out how to get the bank to pay you for using their services, not the other way around.
  5. Economics

    What's the Federal Funds Rate?

    The federal funds rate is the interest rate banks charge each other for overnight loans to meet their reserve requirements.
  6. Economics

    Evaluate Your Investment Portfolio For 2015

    The beginning of a year is a good time to evaluate your investment portfolio and think about how to position it going forward.
  7. Personal Finance

    What precise measures are implemented in most monetary policies?

    Read about some of the precise measures implemented in most monetary policies, and learn why monetary policy is considered important.
  8. Economics

    Under what circumstances will a government change its monetary policy?

    Learn about the kind of variables, including political and theoretical factors, that can bring about change in a government's monetary policy.
  9. Economics

    What's the highest year-over-year inflation rate in the history of the U.S.?

    Learn about periods with the highest inflation in U.S. history and the mandated role of the U.S. Federal Reserve in controlling inflation.
  10. Economics

    How Is Europe Affecting The Martkets?

    Quantitative easing in Europe is coming, but too slowly to avert a severe slowdown and perhaps even a hard landing.

You May Also Like

Hot Definitions
  1. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  2. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  3. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  4. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  5. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
  6. Key Performance Indicators - KPI

    A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their ...
Trading Center