- Payment that is deposited at the same financial institution on which it was drawn or written, e.g., a cheque that was written by one customer of a bank and deposited by the recipient at another branch of the same bank. These items are not cleared between institutions and therefore are generally not represented in statistics of payments exchanged between financial institutions in the clearings.
Related Terms and Acronyms
- Bank — Definition,
- An institution that acts as a financial intermediary by receiving money from depositors and lenders and also lending to borrowers.
- Canadian Payments Association (CPA) — Company, Canada,
- This association, which is composed of several financial institutions and the Bank of Canada, operates a national clearing system for financial institution payments.
- Cheque Clearing — Definition,
- When you write a cheque to a person or a company, the cheque is typically cashed when deposited into a bank account. Your chequing account is then debited for the amount of the cheque and the cheque is said to have "cleared."
- Clearing and Settlement (C&S) — Acronym,
- The process whereby banks collect or pay out for items drawn on or paid into accounts in their institution. This process enables banks to accept each other's cheques and bank drafts for deposit. The Canadian Payments Association operates Canada's clearing system.
- Correspondent Bank — Definition,
- A bank that holds deposits of another bank, usually a smaller bank, and in turn provides certain banking services that may not be readily available to the smaller bank.
- Deposit — Definition,
- An act of putting a sum of money in to a bank account.
- A sum of money put towards a given transaction. In a property purchase, a deposit signifies the intent to buy, which is paid to the vendor and applied to the principal cost.
- Regional Bank — Definition,
- A bank with a primary market in a regional or metropolitan area but takes deposits from throughout the province in which it is located. Usually called a Credit Union in Canada.