Skip to main content

What is the difference between zero day hold and next day funding?

Essentially both of these terms refer to the same thing. Typically when a merchant batches out or closes out the transactions for a certain day of sales, the processing bank places those funds on hold for one or two additional days as a precaution against potentially fraudulent charges, charge backs, etc. Then the funds are released and move through the processing bank to the merchant’s bank. This means that it can take 2-3 days for the merchant to receive the money from credit card sales on a particular day.

Now consider the term Zero Day Hold. This means that the processor releases the funds right away so the merchant can receive the funds the next day or the day after depending on when they batched those funds. Please keep in mind that it takes additional time for the money to be deposited into the merchant’s bank account once the processor releases the money. (You will recall that when you deposit a personal check from a relative or someone else into your bank account, those funds are not always readily available the day you made the deposit.) The term Next Day Funding is really the same concept since the processor is funding the money the next day.

However, more and more banks are providing a true Next Day Funding solution for merchants who have their business checking account and merchant account with the same bank. When the merchant batches out a day’s sales, then the bank advances those funds right to the merchant the very next day. Since the funds are all contained in the same institution, the funds are released to the merchant almost instantly. Many merchants might feel that the best solution for their business. Something to consider though is whether the merchant account fees are going to be higher than with a third party processor (Often banks charge more). A business owner should also consider whether they really need the funds deposited that quickly into their checking account. I would dare to say that the business is teetering towards failure if a one or two day delay in receiving funds is the absolute required feature of a merchant account.

What are your thoughts? Please click comment link to answer. (You will be directed to quickly create an account with Intense Debate first and login before you can comment.)

Comments

Popular posts from this blog

THE IMPORTANCE OF MERCHANT STATEMENT ANALYSIS IN BUSINESS

Businesses often rely on a variety of vendors and suppliers to provide the materials and services needed to run their operations. However, it's important to keep track of these expenses and ensure that you are being charged correctly. One way to do this is through merchant statement analysis. Merchant statement analysis is the process of reviewing and analyzing the statements provided by your vendors and suppliers. This allows you to identify any errors or discrepancies in the charges, such as duplicate charges or incorrect pricing. By regularly having your statements reviewed, you can ensure that you are only being charged for the goods and services that you have actually received. The best help with merchant statement analysis is from us: Merchant Statement Analysis. Its our very name! This service  quickly and easily reviews and analyzes  merchant credit card statements. It can save time and reduce errors, leading to more accurate and reliable financial information. A merc

DON'T GET OVERCHARGED FOR CREDIT CARD PROCESSING FEES!

Hey there! So, accepting credit cards is pretty much a necessity for any business these days, right? But, the cost of credit card processing can add up quickly. From merchant account fees to chargeback fees, it can be tough to keep track of what you're paying and why. In this article, we're going to break down the costs of credit card processing and give you some tips on how to avoid overpaying. First, there's merchant account fees. This is the fee you pay to the company that sets up your merchant account, which is the account you use to accept credit card payments. Merchant account fees can vary widely, and they can include monthly fees, annual fees, and application fees. It's important to shop around and compare merchant account fees from different providers to make sure you're not overpaying. Next, there's interchange fees. These are the fees that are charged by the credit card issuer, such as Visa or Mastercard, for each transaction. These fees are set by th

FIND THE LATEST MERCHANT CREDIT PROCESSING INTERCHANGE RATES HERE

LATEST OFFICIAL INTERCHANGE RATES  Here is where you will find the latest interchange reimbursement rates that are available to the public.  Merchant Statement Analysis is here to help you with your statement quote needs.  Just click the Welcome MSA logo to the right of this page to visit our website and get more help.  VISA USA VISA EUROPE   MASTERCARD  MASTERCARD EUROPE WELLS FARGO PASS-THROUGH FEES  WELLS FARGO PAYMENT NETWORK QUALIFICATION MATRIX