on 23-09-2016 05:19 PM
We’ve had a few questions about when the vendor will receive settlement funds. I wanted to share the details with everyone here.
During settlement, PEXA will send payment instructions to banks/financial institutions. The progress is displayed in the financial settlement status bar.
The time until the vendor receives funds has varied in each electronic settlement. We’ve seen some cases where vendors have received funds same-day, and some cases where it has taken longer. The time varies based on the banks involved and a number of other factors.
It’s important to remember that via PEXA vendors will receive sale proceeds as cleared funds, eliminating the need to wait for a bank cheque to clear before they can access their money. Also, the inconvenience of having to bank a cheque is removed.
Helpful Video: What happens at Settlement https://community.pexa.com.au/t5/Transacting-in-PEXA/What-happens-at-Settlement/ba-p/270#M5
If you have any other questions for me, please ask away!
on 27-09-2016 04:50 PM
Thanks for sharing this Joelle. I'm sure the community will find it very helpful.
on 29-01-2018 02:14 PM
I just settled one a few days ago where the vendors only received the funds in their account 6 hours after settlement. I have been telling clients that the funds will be received within the hour after settlement but obviously that's wrong.
What are we meant to tell clients? within the day? within 48 hours? There has to be some time-frame given so that clients' expectations can be managed. We are expected to promote PEXA with our clients but saying "some cases vendors have received funds same-day, and some cases where it has taken longer. The time varies based on the banks involved and a number of other factors" is not very compelling, is it?
It's true that PEXA removes the need to bank a bank cheque, but the clients never see that advantage, it's always been part of the service. So what is PEXA doing to ensure that banks are complying with clearing funds within a set time limit?
on 31-01-2018 09:07 AM
Unfortunately we can not guarantee clearance times on funds. There are still normal bank processes that apply, making us unable to provide timeframes. While we have seen cases where funds are cleared the same day, and even within the hour, that is not always the case. We recommend that you tell your client’s that they will receive cleared funds without giving any expectation of timeframe.
on 06-11-2018 01:02 PM
Are you still not able to provide any information as to when vendors will receive funds? We cannot tell vendors that they will get their funds faster if they use PEXA if this is not the case.
Your brochure includes the heading "Get your money fast" and the text "Why wait days for cheques to clear?"
This seems a bit misleading if vendors are sometimes waiting even longer for their funds when settling via PEXA than they would have been if settling manually.
I understand that there is a range of experiences, but please let me know the range of times we could be looking at.
on 16-01-2019 09:33 AM
I agree with the comments below - I don't believe that tell clients that they will receive their funds as cleared funds with no idea of when is sufficient. Most clients were prefer to have a bank cheque in their hand and know that they have it and it will clear in 3-5 days then not see anything.
The banks need to start working more efficiently and streamline their processes at both ends of the PEXA transactions. Entering figures and signing off documents in the minutes before settlement (or after it has rolled over at least once) is not sufficient and causes lost times with having to continuing check the system to advise clients. It is also not sufficient them to be "holding" funds in their source account to receive interest (which is what I am assuming they are doing) prior to releasing it to the clients.
In some cases the clients require the funds for another transaction of some sort and they are lead to believe by the banks and PEXA that PEXA is a quicker of way of getting funds.
16-01-2019 05:32 PM - edited 17-01-2019 09:29 AM
It's really not something we can pin-point; as previous posters have said, it varies bank to bank, and there are many banks and combinations of banks that can be part of a PEXA transaction.
You're absolutely correct when you say that entering figures and signing off documents in the minutes before settlement (or after it has rolled over at least once) is not sufficient. From my experience though, it is not to accrue interest that banks prefer to do this the day before or day of settlement, it is to provide their customers access to their funds for as long as possible before settlement occurs.
on 13-07-2020 01:58 PM
My understanding of "Cleared Funds" is funds are subject to the banks various processing times before cleared and available in the vendors account, whether paid by electronic transfer or bank cheque.
Please clarify how PEXA claim vendors will receive sale proceeds as cleared funds, eliminating the need to wait for a bank cheque to clear before they can access their money.