Stop Payment

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DEFINITION of 'Stop Payment'

A request made to a financial institution to cancel a check or payment that has not been processed yet. A stop payment order is issued by the account holder, and can only be enacted if the check or payment has not already been processed by the recipient.

BREAKING DOWN 'Stop Payment'

Issuing a stop payment order often costs the bank account holder a fee, which is levied by the financial institution. There are several reasons that a stop payment order may be requested. For example, the account holder may have sent a check for the wrong amount, or may have canceled a purchase after having put the check in the mail.

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RELATED FAQS
  1. How can I cancel a bank draft that I have purchased?

    It is not commonly possible to cancel or stop payment on a bank draft since it, in effect, represents a transaction that ... Read Full Answer >>
  2. How does a bank determine what my discretionary income is when making a loan decision?

    Discretionary income is the money left over from your gross income each month after taking out taxes and paying for necessities. ... Read Full Answer >>
  3. For what types of accounts are demand deposits available?

    There are essentially three types of accounts available as demand deposits: checking accounts, savings accounts and money ... Read Full Answer >>
  4. What proportion of my income should I put into my demand deposit account?

    Generally speaking, aim to keep between two months and six months worth of your fixed expenses in your demand deposit accounts. ... Read Full Answer >>
  5. What net interest margin is typical for a bank?

    In the United States, the average net interest margin for banks was 3.03% in the first quarter of 2015. However, this was ... Read Full Answer >>
  6. What are the main benchmarks that track the banking sector?

    The appropriate benchmarks for tracking banking sector performance depend on the type of banking. For instance, commercial-only ... Read Full Answer >>

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