What Does a Pending Transaction Mean on a Bank Account?

By Ashley Kilroy · February 27, 2024 · 9 minute read

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What Does a Pending Transaction Mean on a Bank Account?

A pending transaction on your bank account means that a transaction is underway but hasn’t been fully processed yet. Perhaps a vendor has accepted your debit card as payment and is working with your bank to receive payment. Or maybe you are expecting an electronic payment but the funds are awaiting release.

Usually, your bank takes a few business days to resolve the pending transaction and post it to your account. However, it’s vital to remember that pending transactions subtract your purchase amount from your bank account as soon as they appear. Likewise, an incoming credit will turn up as an addition to your balance, usually with an anticipated release date.

Bank pending transactions, even if they come from vendors you recognize, may require a closer look. For instance, why is there an extra charge from the gas station you visited this morning? And why would a charge still be pending from the sandwich shop you stopped at last week? These items are examples of pending transactions, which can create holds on your account until your bank resolves them.

Key Points

•   A pending transaction on a bank account means a transaction is in progress but hasn’t been fully processed yet.

•   Pending transactions can include purchases, bill payments, or deposits that are awaiting completion by the bank.

•   Banks typically take a few business days to resolve pending transactions and post them to the account.

•   Pending transactions affect the account balance as the purchase amount is deducted immediately, and incoming credits are added with an anticipated release date.

•   It’s important to review pending transactions, as they can create holds on the account until the bank resolves them.

What Is a Pending Transaction?

A pending transaction on your bank account means your bank is processing a purchase you made, a bill you paid, or a deposit that’s heading your way, but it hasn’t been completed yet. Either the payment hasn’t been sent to the vendor yet or the incoming funds haven’t cleared, although they are in process.

For instance, when you purchase a good or service by using your debit card, your account will show a pending transaction shortly after. This acknowledges that you used your card, shows the amount, but the transaction isn’t in the rearview mirror just yet. Here’s why:

•   Pending purchases happen when you swipe, insert, or tap your card, the business you’re transacting with confirms the card is valid through a quick online process.

•   Then, the business accepts the purchase and puts a hold on your account, signifying that your bank needs to pay them for the purchase. This hold creates a pending transaction on your checking account.

•   The business resolves the pending transaction on your account by settling your purchase with your bank or financial institution. When your financial institution receives communication from the business, it will perform a bank transaction deposit to the business’s financial account.

•   Once the business receives payment, the transaction goes from pending to posted.

Likewise, pending deposits happen when the funds from another account haven’t been released to your bank account yet. However, they appear pending to let you know funds are processing and should be deposited soon. This could reflect a check you deposited or perhaps a direct deposit that you set up.

How long do direct deposits take to clear? Typically, direct deposits can take a couple of days to clear, but paychecks are often orchestrated in advance to show up and be available on payday, so they may appear instantaneous.

If you’ve deposited a check, it typically takes no more than two days to clear, but in some situations, it can take up to a week.

Recommended: What Happens if a Direct Deposit Goes to a Closed Account?

Pending Transaction vs Posted Transaction

A bank pending transaction and a posted transaction represent two different stages of your bank or financial institution processing a payment or a deposit. Specifically, the difference is:

•   A pending transaction on your bank account means one of two things: either a merchant initiated a request for payment to your bank because of a purchase you made with your debit card or a deposit is waiting to be released into your account.

•   To get to posted transaction status, your bank finishes processing the payment or deposit request, and money goes from your account to the vendor to fund your purchase or vice versa. For example, say you spend $50 at the grocery store. After you use your card, the store communicates with your bank to record a pending transaction. Then, your bank uses funds in your account to fulfill your grocery purchase. Your account has a posted transaction, a debit, of $50 after your bank pays the grocery store.

How Long Does a Transaction Stay Pending?

A transaction typically stays pending for one to three business days. During this time, your bank or financial institution processes the request and transfers money from one account to another according to your purchase or deposit amount.

After these steps occur, the transaction is no longer pending. It becomes a posted transaction.

What Causes a Transaction to Stay Pending?

A transaction can stay pending for various reasons.

•   First, the vendor you transacted with might be slow to move the payment from your bank. The transaction stays pending until the vendor accepts payment from your bank. If the vendor takes too long to accept the money, the bank can cancel the transfer. If that happens, the pending transaction will vanish from your account, along with the charge against your balance.

•   In addition, pending transactions can take longer to clear because of how businesses operate in specific industries. For example, a hotel won’t resolve a pending transaction on your account until you check out because you might, say, order room service during your stay, increasing your bill. As a result, the pending transaction stays on your account until the hotel can charge the grand total to your card.

•   Lastly, transactions can stay pending because of holidays and weekends. During these times, banks and businesses may take longer to resolve pending transactions on your account.

How Does a Pending Transaction Impact Your Account Balance?

Although a pending transaction on your bank account means the vendor hasn’t received payment yet or the funds for the deposit are not cleared, it still influences your account balance. Put another way, pending transactions count toward your balance, which helps prevent you from overspending money.

There’s another benefit to this practice: That quick deduction of pending charges from your bank account balance might help you avoid overdraft or NSF fees. You see how much money is actually in your account and can therefore be cautious with your purchases.

Pending Transaction Examples

Say you have $2,000 in your bank account, and you go to buy a $400 espresso machine. The merchant initiates a hold with your bank account, and your bank creates a $400 pending transaction on your account. This transaction reduces your account balance by $400.

Meanwhile, the bank takes four days to process the merchant’s request. However, the moment the pending transaction hit your account, your balance changed to $1,600. As a result, you had a realistic sense of the money available to spend immediately after buying the espresso machine despite your bank taking four days to pay the merchant.

In other words, the bank pending transaction is instantly subtracted from your bank account to prevent you from overdrafting. So, when managing your checking account, your balance might be lower than expected from time to time. In these situations, check for pending transactions from recent purchases, as they may be taking away from your balance sooner than you thought.

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Can You Cancel a Pending Transaction?

Depending on where you are in the purchase process, you may be able to cancel a pending transaction with the vendor or your bank. Here are a few scenarios to consider. First, here’s how you might be able to work with a vendor:

•   Perhaps you place an online order for new clothes and feel buyer’s remorse a few hours later when you see the pending transaction hit your bank account. Fortunately, the vendor probably hasn’t shipped your order yet, so you contact them and cancel the order. Once your vendor processes the cancellation, the pending transaction should disappear from your bank account and restore your available funds.

•   What if you placed an online order, but you notice the pending transaction on your bank account is double the amount of what you actually ordered? You realize the vendor has charged your account twice, so you notify them about the issue. Once they rectify the ordering error, the pending transaction should change to the correct amount.

In other situations, contacting your bank or financial institution is a better move.

•   If you see an unfamiliar pending transaction from a company you don’t remember doing business with, it’s best to notify your bank of the suspicious activity. The bank will investigate on your behalf and cancel any fraudulent charges.

•   If you see a pending transaction for an amount that doesn’t match your records, you can ask your bank to nullify the charge. This option is helpful if you can’t get in touch with the vendor or want to avoid overdrafting your account.

•   Say you have a pending transaction from a business that is unresponsive to your communication or refuses to cancel the transaction. In that case, contacting your bank to cancel the pending transaction can resolve the issue.

Recommended: Benefits of Using Mobile Deposit

The Takeaway

A pending transaction on your bank account means your bank is processing a purchase or an incoming deposit from another account. Although a pending transaction signifies your vendor has yet to receive payment or the deposit funds aren’t released yet, the amount involved is typically reflected from your bank account. This gives you an accurate, up-to-date picture of the money you have available.

It’s possible to cancel a pending transaction by contacting the vendor or your bank, but it’s crucial to act quickly.

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Are pending transactions already deducted from my account?

Once a pending transaction appears on your bank account, the amount is deducted from your balance. As a result, you don’t have to wait for the transaction to post to see how the purchase impacts your bank account.

What do I do if my transaction is pending?

If your transaction is pending, all you need to do is wait for your bank to resolve the charge with the vendor or the deposit to your account. This process usually takes one to three business days. The only reason to take action regarding a pending transaction is if you want to cancel it.

Can pending transactions be declined?

A vendor can decline a pending transaction by not accepting payment from your bank. This scenario means the vendor loses money on your purchase, so it’s rare for this to happen (unless, say, an item is sold out). The vendor will also decline a pending transaction if you successfully cancel your order with them.

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