February 05, 2004

"Pending" Issues with Banks "On Hold"

I find it curious as to why when we transfer funds from one Canadian bank to another, it can take several days for the funds to appear in the destination account, and even then there might be a note with a "pending" or a "$XXXX on hold" qualifier attached. Initiate the transaction on a Friday just before the weekend, and it can add up to four, five or more days.

Of course banks will talk about "business" days, but once you initiate the transaction, I highly doubt if you're getting any interest on the transfer amount.

We regularly transfer business income from a Japanese bank to a Canadian bank, and that money usually arrives in our Canadian account, ready to access, in less than 24 hours.

What gives? I know banks make money on the transfer float, or whatever one calls it, but three or four days to shift a few digits from one computer to another from one financial institution to another in the same country? Computers don't sleep....

Posted by Paul at February 5, 2004 11:21 PM