2-4-6 changes explained
The example and diagram below show how the 2-4-6 changes will work.
We have also produced an animated guide to 2-4-6 changes.
Daniel runs a window cleaning business and he only accepts cash or cheques as payment. Daniel collects all cheques made out to his company from the previous week and takes them into his bank to pay in on Monday morning.
His company account starts to earn interest on the money on Wednesday (+2 days), and by Friday morning (+4 days) his bank will enable him to withdraw the money from the deposited cheques from the account, even though the cheques could still bounce.
By the end of the following Tuesday (+6 days), he can be certain that the cheques will not bounce, and the money from them cannot be reclaimed from the company account without his consent.
Footnotes:
- You can pay in a cheque in a number of ways – across a branch counter, at a cash machine, by post or at a post office. This may affect when your bank actually receives the cheque. You may also need to deposit a cheque before a certain cut-off time, so if certainty is important to you, you should check with your bank or building society.
- If your account pays interest on credit balances. It is also the point at which this money will reduce the balance on which overdraft interest is charged.
- Not necessarily for savings accounts.
- You will be able to withdraw this money from your savings account if the account allows withdrawals.