How Long Does It Take To Receive My Money For Credit Card Transactions?

Your credit card processor will be able to give you an answer to the question how long does it take to receive my money from a credit card transaction. The usual answer is “within 24 to 48 hours”. That timeframe can be affected by certain factors like how often and what time of the day you batch out your sales, but 24 to 48 hours has for many years been the industry’s standard answer to the question “When do I get my money from a credit card sale?”

What Is Meant By Payment In Arrears?

No, this doesn’t mean your credit card processor is late paying you. Payment in arrears simply means that credit card sales you transact today will be paid at a set time in the future. For example, if you are on a plan that pays two days in arrears, it means that all sales that are at least 2 business days old are paid on the third day. The cutoff point is based on your batch processing cutoff time. If you process your transaction at or before your batch processing deadline, that sale appears on your statement dated the day you posted it and will be paid in 2 business days. If you process a transaction after your batch processing deadline, the transaction posts the next day and will be paid 2 days after that.

When understanding how long does it take to receive my money for credit card transactions, you should be aware of the gap between the time of sale and the time the merchant has access to funds that can make it hard on business owners to manage their cash flow. And managing cash flow is one of the keys to growing any business. Take for example, the small restaurant owner who does the largest percentage of his business on the weekend. It could be Tuesday of the following week before he sees the proceeds from credit card transactions from Friday, Saturday or Sunday receipts leaving him little time to purchase needed supplies for the next big push. Or the small landscape company owner who needs the cash from the job he just finished to pay for the supplies he needs for the next project. Even a small delay of a few days in cash flow can make it hard to maintain and grow a business.

Faced with growing competition in the industry, credit card processing companies are always looking for new services that will appeal to prospective customers. Next day funding is a growing trend in the credit card processing industry that is especially beneficial to business owners who depend heavily on each day’s sales proceeds.

What Is Next Day Funding?

Next day funding means exactly that: process a credit card transaction today and you have access to the proceeds from the sale tomorrow morning. Sounds great, but it’s not so simple. Each merchant account provider that offers this service has different eligibility prerequisites based on your credit score, average ticket amounts, your MCC code, and other aspects of your business.

To be fully aware of how long does it take to receive my money once you are approved for next day funding, you should understand and follow the terms and conditions spelled out in your contract. Depending on when your acquiring bank or processing network submits your daily batch of transactions impacts when you get your money. For example, let’s say your acquiring bank has a batch cut off time of 5:30PM EST. If you have next day funding, the proceeds from the day’s transactions processed before that time will be deposited into your merchant account the following morning. Any transactions processed after 5:30PM EST will be paid within the regular 24 to 48 hour time frame.

If you manually settle your daily transactions or have your terminal or software programmed to settle your transactions at the time specified by your processor, you could have your money in as little as 8 – 12 hours from the time you send in the transactions, rather than waiting the standard 24 to 48 hours.

Sounds Great, But Are There Drawbacks?

Some providers do charge an extra fee for this service, often based on processing volume. Be sure you understand what you’re being charged for and ask if the fee is negotiable.

Also ask if the deadline for settling your daily batch of transactions is flexible. A fixed deadline of 5PM really doesn’t help the merchant who does most of his business in the evening.

When it comes to answering the question how long does it take to receive my money for credit card transactions, considering next day funding may sound like the perfect service to add to your credit card processing contract. It is important to be sure that it actually suits your business model. However, if you can customize the service to fit your needs, next day funding can be the solution to business cash flow dilemmas.