Stop Payment

What is a 'Stop Payment'

A stop payment is 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.

RELATED TERMS
  1. Automatic Bill Payment

    A money transfer scheduled on a predetermined date to pay a recurring ...
  2. Certified Check

    A type of check where the issuing bank guarantees the recipient ...
  3. Rubber Check

    Another name for a "bounced check." A rubber check is a slang ...
  4. Canceled Check

    A check that has cleared the depositor's account and has been ...
  5. Exception Item

    A banking term used to describe a check that cannot be processed. ...
  6. Returned Payment Fee

    A charge a credit card company may assess to a customer’s account ...
Related Articles
  1. Credit & Loans

    4. Cancel Automatic Payments

    Learn when it's a good idea to close a credit card, and how to make sure you do it right.
  2. Trading Strategies

    Simulator How-To Guide: Cancelling Orders

    Depending on the order type and the time of day, a player may have the capability to cancel an order from being executed. Please realize that limit and stop orders can always be canceled prior ...
  3. Options & Futures

    Protect Yourself From Market Loss

    There are several simple strategies you can use to protect yourself from downside risk.
  4. Investing

    How To Start Trading: Order Types

    The types of orders you use can have a large effect on your trading performance, so understanding the different order types is important to your success.
  5. Professionals

    Orders

    Orders
  6. Savings

    Explaining Checking Accounts

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

    How Digital Payments Will Change Commerce in 2016

    The way we transfer and spend money is constantly evolving, and 2016 is poised to expand digital payments like we've never seen before.
  8. Savings

    Banking: Check-Writing 101

    By Amy FontinelleThe ability to write checks from your checking account allows you to pay bills or send money to relatives more securely than using cash and less expensively than using a cashier's ...
  9. Professionals

    Types Of Orders

    Investors can enter various types of orders to buy or sell options. Some orders guarantee that the investor’s order will be executed immediately. Other types of orders may state a specific ...
  10. Options & Futures

    A Logical Method Of Stop Placement

    If holding on to losing trades is human nature, this tool will help protect you from yourself.
RELATED FAQS
  1. How do you calculate payback period using Excel?

    Understand the various fees that can be assessed on a personal or business checking account, and learn methods to avoid being ... Read Answer >>
  2. What is the difference between a buy limit and a stop order?

    Learn the difference between buy limit orders and stop orders, including stop loss orders, and understand the risks of the ... Read Answer >>
  3. Is a deficit in the balance of payments a bad thing?

    Discover how it might be possible to run a balance of payments deficit, what that means in terms of international trade and ... Read Answer >>
  4. What does "gather in the stops" mean?

    "Gather in the stops" is a trading strategy used by investors to trigger stop orders already in place so that the price of ... Read Answer >>
  5. What is the difference between a stop order and a stop limit order?

    Learn the differences between a stop order and a stop limit order. Traders use these as stop losses and regular investors ... Read Answer >>
  6. When should I use a trailing stop order?

    Learn about trailing stop orders, how to use them and when they should be used through an extensive example. Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center