RUCRAYZE
Elio Addict
the float is the number of days between transactions that are invested by the banks. i.e.you post a check to someone, -your bank withdraws the funds from your account, and the few days between processing the check of the receiver of your check is the float. When I send my kids a gift check, the funds are deducted from my account, and as their usual my kids might take a week to cash/deposit it, that time between the transactions the money is being used by the banks.
better defined by-
Definition[edit]
"Float is money in the banking system that is counted twice, for a brief time, because of delays in processing checks or any transfer of cash", as defined by the [Federal Reserve Banks of United States].[1] It is most obvious in the time delay between a cheque being written and the funds to cover that cheque being deducted from the payer's account.[2]Once the payee or recipient of a cheque deposits it in a bank account, the bank provisionally credits the account and thus increases the payee's account in demand deposit, assuming that the payer's bank will ultimately send the funds to cover the cheque. Until the payer's bank actually sends the funds, both payer and payee have the "same" money in both of their accounts. Once the payee's bank notifies the payer's bank by presenting the cheques, the "duplicate" funds will be removed from the payer's account, and the cheques will be considered to have "cleared" the bank.
In cheque clearing, banks refer to 'bank float' and 'customer float'. 'Bank float' is the time it takes to clear the item from the time it was deposited to the time the funds were credited to the depositing bank. 'Customer float' is defined as the span from the time of the deposit to the time the funds are released for use by the depositor. The difference between the bank float and the customer float is called 'negative float'.
better defined by-
Definition[edit]
"Float is money in the banking system that is counted twice, for a brief time, because of delays in processing checks or any transfer of cash", as defined by the [Federal Reserve Banks of United States].[1] It is most obvious in the time delay between a cheque being written and the funds to cover that cheque being deducted from the payer's account.[2]Once the payee or recipient of a cheque deposits it in a bank account, the bank provisionally credits the account and thus increases the payee's account in demand deposit, assuming that the payer's bank will ultimately send the funds to cover the cheque. Until the payer's bank actually sends the funds, both payer and payee have the "same" money in both of their accounts. Once the payee's bank notifies the payer's bank by presenting the cheques, the "duplicate" funds will be removed from the payer's account, and the cheques will be considered to have "cleared" the bank.
In cheque clearing, banks refer to 'bank float' and 'customer float'. 'Bank float' is the time it takes to clear the item from the time it was deposited to the time the funds were credited to the depositing bank. 'Customer float' is defined as the span from the time of the deposit to the time the funds are released for use by the depositor. The difference between the bank float and the customer float is called 'negative float'.
