How Long Does It Take For a Cheque to Clear in Singapore?

For a cheque to "clear" means that the funds have been successfully transferred from the payer's or cheque writer’s bank account to the payee's or cheque recipient’s bank account. And as mentioned, most types of cheques in Singapore are cleared by the next business day (jump to a list of banks that clear cheques the next day).

» Learn how to deposit a cheque with this step-by-step guide

Cheque clearing involves a process where the cheque is presented to the payer's bank, the bank verifies that there are sufficient funds and that the cheque is valid, and then the funds are transferred to the payee's bank. This process is facilitated by the banking system's clearing mechanisms. 

Here’s an example of a one-day standard cheque clearing with Singaporean banks.

Cheques drawn on the same financial institution as your account typically clear more quickly as long as they are deposited before the cut-off time.

» Check out the best cash management accounts in Singapore

While cheque clearing in Singapore is generally efficient, several factors can sometimes lead to delays. Here's a breakdown of the common reasons:

• Different banks in Singapore may have their own internal procedures and processing schedules for cheques, especially if it’s a foreign currency (non-Singapore dollar) or United States dollar (non-local cleating), which may take a minimum of 30 business days.

• Opting for alternative options, such as Quick Cheque Deposit Boxes, which can have its own clearing times can be longer than regular cheque clearing.

• Banks have cut-off times for cheque clearing, and those deposited after the cut-off time will typically be cleared after two business days.

To ascertain the precise availability of funds, it's advisable to check with your bank.

The cheque clearing process involves several steps to ensure the funds are properly transferred. Essentially, the bank where the payee deposits the cheque needs to obtain the money from the payer's checking account.

This isn't a same-day process. If the payer's account is held at a different financial institution, the cheque is typically sent to the Automatic Clearing House (ACH). The ACH acts as an intermediary, facilitating the transfer of funds between the banks. And the bank may dishonour a cheque due to insufficient funds in the account. As the bank determines whether to honour or return the cheque on the next working day, your account may show an automatic overdraft on the day of processing, even if you don't have an agreed overdraft facility. If the bank returns the cheque, the corresponding amount will be credited to your account. However, since the bank funded the cheque before this decision, an overnight incidental overdraft (OD) interest charge is typically applied.

Besides insufficient funds, which often results in penalties for both payer and payee, other reasons for a bank to dishonour a cheque include an incorrect date (cheques have a validity period) or signature discrepancies (a fraud prevention measure). A 'stop payment order' from the payer (e.g., due to a lost/stolen cheque or dissatisfaction) and damage or suspected alterations to the cheque can also cause delays.

The following are some major banks that may offer next-working-day availability for personal cheques, provided there are no other holds or delays.

While cheques are still accepted in Singapore, it's worth noting that there are now faster, more secure, and convenient alternatives for transferring money. These newer methods often offer significant advantages over traditional cheques, making them preferable for many transactions.

Singapore offers several popular and efficient alternatives to cheques for transferring money, such as Fast And Secure Transfers (FAST), wire transfers, General Interbank Recurring Order (GIRO), and PayNow. 

Therefore, if you're expecting a significant sum of money, it may be worth requesting the payer to use direct deposit or a peer-to-peer payment app. These digital options offer speed and convenience, and they eliminate the need for physical cheques. Bank transfers using FAST provide instant and secure transfers. 

Meanwhile, GIRO allows inter-bank transfers but may take up to 3 working days for the funds to be available, and it automates recurring payments like bills. Lastly, PayNow enables instant peer-to-peer transfers via phone number or National Registration Identity Card (NRIC).