What is the Difference Between Account Balance and Available Balance?
🆚 Go to Comparative Table 🆚The main difference between account balance and available balance lies in the inclusion or exclusion of pending transactions.
- Account Balance: This is the total amount of money in your account, including all posted credit and debit transactions. It represents the amount you have in the account before any pending charges are added.
- Available Balance: This is the amount you can use for purchases or withdrawals. It is made up of the account balance minus pending debit card authorizations and holds on funds. Available balance excludes pending transactions and check holds from your account balance.
Some key points to remember:
- Your available balance is the more accurate snapshot of how much money you have in the account since it takes into account pending transactions and holds.
- You should always use the available balance to determine how much money you have available for purchases or withdrawals, as using the account balance might lead to an overdrawn account if it includes transactions that have not been processed yet.
- A common reason for a difference between the current balance and available balance is a recent deposit that has not fully posted to the account or a hold on the account due to a recent debit card transaction.
In summary, the account balance represents the total amount of money in your account, including pending transactions, while the available balance is the amount you can actually use for purchases or withdrawals, excluding pending transactions and holds.
Comparative Table: Account Balance vs Available Balance
The difference between account balance and available balance lies in the factors they consider. Here is a table comparing the two:
| Account Balance | Available Balance |
|---|---|
| Includes all pending transactions | Excludes pending transactions |
| Represents the total amount in the account | Represents the amount available for immediate use |
| May be affected by holds or debits that haven't yet been posted | Not affected by holds or debits that haven't yet been posted |
The account balance includes all transactions, including those that are pending and have not yet been cleared by the financial institution. On the other hand, the available balance is the total amount that has been cleared for deposits or transfers, and it is the amount the account holder is free to use immediately. This balance does not consider any holds or debits that haven't yet been posted to the account. In summary, the account balance represents the total funds in an account, while the available balance represents the amount that can be used immediately, excluding pending transactions.
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