cheques awaiting clearance.

[Blyss]

About a year ago I took a personal cheque to my bank and was told that I would have to wait 6 working days for it to clear , it was only for $100 so in sterliing it wasnt a great deal . The christmas before I went into the bak with a cheque from the same person {my mother in law } for $800 and it was cleared straight away I was also given the cash straight away.So when that happendd to me a few months later I went to the top and complained loudly about it.I was offered some of the cash by my bank but told quite clearly that cheques take 6 working days to clear and thats that , imagine my suprise when next morning the cheque was cleared .
Today I deposited quite a large goverment cheque into my account (�1048.30p} and was told the same I have to wait 6 working days for it to clear ..I cannot for the life of me understand why???

can anyone on AB help?

[spudqueen]

Do you bank with a clearing bank (NatWest, Barclays, HSBC, LLoyds?) if so then it should take 4 working days. The first day the cheque is with the branch you paid it in at, the second day it is at 'clearing' (a national centre where all cheques are sent to be sorted to go to the bank and branch they were drawn on) then the third day the cheque is with the branch of the bank on which it is drawn. That bank do not have to authorise that it is okay for paying for another day. They can return it for a number of reasons (out of date, post dated, no payee, words and figures differ, not signed, not enough funds to pay cheque, cheque listed as lost or stolen etc etc etc), which makes the fourth day. If you do not bank with a clearing bank they have to pay all their things in through a clearing bank so that is why it will take longer.
Hope all that makes sense!

[ugly_bob]

spudqueen - Thanks for that explanation. I never actually understood why it took so long

AFAIK the banks are being told to sort it out now though. Since everything is now done electronically, the ombudsman has told them to 'do it quicker'

Why does it still take 4/5 days for an electronic transfer to move accounts? It leaves the payers account immediately, but doesn't appear in the payyes for days. The banks make (?millions?) from this every year due to the interest they don't pay/charge while these transactions are in progress

[dzug]

It's possible that the cheque that was paid the same day was drawn on the same branch that you took it to - they could then short circuit the clearing process.

Not sure why there was a difference if this was not so.