Why does NatWest take payments early?

[Terry Pinnell]

Not something I'll lose sleep over, but I'm curious...

Just checked my NatWest online current a/c statement (00:30 on
1/1/2017). The most recent two entries are dated 3/1/2017. About £220
in total, taken two days earlier than the scheduled standing order
date of Tuesday 3rd January.

Multiply a few hundred thousand times and that's a tidy bit of
illegitimate interest going to Natwest, isn't it?

[Chris in Makati]

On Sun, 01 Jan 2017 00:38:40 +0000, Terry Pinnell

Post by Terry Pinnell
Not something I'll lose sleep over, but I'm curious...
Just checked my NatWest online current a/c statement (00:30 on
1/1/2017). The most recent two entries are dated 3/1/2017. About £220
in total, taken two days earlier than the scheduled standing order
date of Tuesday 3rd January.
Multiply a few hundred thousand times and that's a tidy bit of
illegitimate interest going to Natwest, isn't it?

That's fairly normal for most banks. Debits are entered on the last
working day before a payment is due. Payments due on Mondays are
usually debited on the previous Friday.

People often used to withdraw money from an ATM over the weekend
forgetting that wouldn't leave enough money in the account for
payments due on Monday, which then failed to go through. When failure
to make a payment on time involved some kind of penalty they would
then blame the bank.

I don't think it necessarily involves any loss of interest. I believe
banking transactions have two dates associated with them, a "ledger
date" and a "value date". The ledger date is what gets shown on your
statement, but interest is calculated based on the value date.

[Terry Pinnell]

Post by Chris in Makati
On Sun, 01 Jan 2017 00:38:40 +0000, Terry Pinnell

Post by Terry Pinnell
Not something I'll lose sleep over, but I'm curious...
Just checked my NatWest online current a/c statement (00:30 on
1/1/2017). The most recent two entries are dated 3/1/2017. About £220
in total, taken two days earlier than the scheduled standing order
date of Tuesday 3rd January.
Multiply a few hundred thousand times and that's a tidy bit of
illegitimate interest going to Natwest, isn't it?

That's fairly normal for most banks. Debits are entered on the last
working day before a payment is due. Payments due on Mondays are
usually debited on the previous Friday.
People often used to withdraw money from an ATM over the weekend
forgetting that wouldn't leave enough money in the account for
payments due on Monday, which then failed to go through. When failure
to make a payment on time involved some kind of penalty they would
then blame the bank.
I don't think it necessarily involves any loss of interest. I believe
banking transactions have two dates associated with them, a "ledger
date" and a "value date". The ledger date is what gets shown on your
statement, but interest is calculated based on the value date.

Thanks Chris, understood.