Same-Day Funds

The term "same-day funds" refers to money that can be transferred or withdrawn the same day that it is deposited. Same-day funds are subject to the net settlement of accounts between the banks that present and remit the funds. Most customer deposits are not same-day funds and are usually not available for withdrawal until the next business day.

In most cases, banks will make funds deposited by customers available the next business day or within two business days. Banks are not required to consider Saturday or Sunday a business day for funds availability purposes, even if they’re open and accepting deposits on those days. While most funds deposited by customers are not considered same-day funds, there are some exceptions.

Cash deposits will usually be available for use the same day. Direct deposits, wire transfers, transfers from other accounts at the same bank and ACH deposits may also be posted as same-day funds, especially if they are posted to the account before the bank’s cut-off time for that day’s business operations, which is usually sometime in mid-afternoon. Deposited checks, money orders, cashier’s checks and other funds may not be available until the next business day or the second business day.

Same-day funds can also refer to federal funds that are sent via bank wire. This money would be sent between banks via the Fedwire Funds Service the same day. The Fedwire Funds Service allows for immediate, irrevocable, and final real-time funds transfers. It’s available to financial institutions and depository institutions that have an account with the Federal Reserve Bank. It’s typically used to make large, time-sensitive payments. Funds are debited from an originator’s account and credited to the account of another participant in the Fedwire Funds Service. Funds can be initiated via telephone or online. More than 9,000 banks participate in Fedwire.

Clearing House Interbank Payments System (CHIPS) transfers in New York are also known as same-day funds. CHIPS is a privately owned clearinghouse for handling large transactions. Transferring money via CHIPS costs less than transferring it via Fedwire, so banks typically prefer to use this service to transfer less time-sensitive payments. While Fedwire is a real-time gross settlement system, payments via CHIPS can be netted, so payments are not made in real time. More than 40 banks participate in CHIPS.