The credit hold period on check deposits depends on the check currency:
- USD Checks: Funds are credited to the account after a 7 business day credit hold, with the exception of Bank Checks, which are credited immediately.
- HKD Checks: The Withdrawal Hold Period is 3 business days (you may withdraw funds after 3 business days).
- CAD Checks: Funds are credited to the account after a 5 business day credit hold (funds are available on the 7th business day).
IBKR does not know when client checks actually clear. We have a corporate account and our bank credits corporate accounts based on the expected clearing date of the check. Our bank uses ABA routing numbers as a proxy to determine how long it will take a check to clear. For example, IBKR will receive value on a check drawn on a New York bank faster than it will receive value on a check drawn on a California bank.
When the maker's bank receives a check for payment it either provides payment or submits notification to the payee's bank that it will not honor the check for payment because of non-sufficient funds, closed account etc. IBKR's bank receives the notification of a returned check via the Federal Reserve and deducts the funds from our bank account since it originally credited IBKR based on an estimated funds availability schedule (not when the check actually clears). Then, we reverse the funds to the client's IBKR account. There is no set time frame for returned checks and we have experienced returned checks up to 7 business days.
Before IBKR implemented the 7 business day hold period, we experienced losses from returned checks. We strive to keep commissions as low as possible and avoid preventable losses. We encourage our customers to send funds via bank check or wire if they require immediate availability of funds.
Additional Information
- Limitations, credit and withdrawal hold period for check deposits available on our website