DEFINITION of Availability
Availability refers to funds that have been deposited by third-party check into a customer's bank account. These funds are typically not usable by the customer until the check clears, or they become "good funds."
BREAKING DOWN Availability
Third-party checks are available according to a schedule that relies on the location of the bank on which the check is drawn. The maximum number of days that a check can be held is set by the Expedited Funds Availability Act, assuming the check is good.
An Example of Availability
Examples of availability and rules of banking can be found on the U.S. Federal Reserve Board's website. Take for instance the following: If customer James Smith deposits a $5,000 certified check to his bank teller at 9:00 a.m. on a Monday, the funds would be available on Tuesday. If he made the deposit at an ATM, the first $100 must be made available by Tuesday at the latest, and the remaining funds must be made available by Wednesday, because it is a certified check. If the customer made a deposit at a nonproprietary ATM, states the Federal Reserve Board, the funds may be held by the following Monday, the fifth business day, and the requirement to make the $100 available on the next day does not apply.
The confusion around availability can happen when a customer makes a deposit and assumes it is available immediately upon receipt.