If Money Is Pending Can I Still Use It?

When reviewing bank accounts or credit card statements, many individuals encounter transactions labeled as “pending.” This article addresses the core question of whether money in a pending state can still be utilized.

What “Pending” Means

A “pending” transaction signifies an action that has been initiated but has not yet been fully processed and settled by the financial institution. This status is temporary and indicates that a transaction is in transit or awaiting final confirmation. For example, when a payment is made, the merchant sends an authorization request to the bank, which places a hold on the funds.

Transactions may remain pending for various reasons, including the time it takes for a merchant to finalize a sale, the internal processing schedules of banks, or security checks. The pending status ensures that funds are reserved while the necessary steps for completion are carried out.

How Pending Transactions Affect Your Funds

Pending transactions have an immediate impact on a user’s account, primarily by affecting the “available balance.” Financial institutions typically display a “current balance” (all posted transactions) and an “available balance” (funds immediately accessible for new transactions).

An authorization hold reserves funds for a pending transaction, effectively reducing the available balance without the money having left the account yet. For instance, when using a debit card, the amount of the purchase is typically authorized and reduces the available balance almost instantly. This hold ensures that the funds are present when the merchant formally submits the transaction for payment.

These funds are not yet fully transferred from your account, nor are they typically available for other spending. The hold guarantees the funds for the specific transaction once it clears. This distinction helps manage daily spending and avoid potential overdraft fees.

Availability Rules for Different Transaction Types

The usability of pending funds varies significantly depending on the type of transaction. For deposits, such as checks, financial institutions often place holds before the funds become fully available. Federal regulations generally require banks to make the first $225 of a check deposit available on the next business day, and this amount is set to increase to $275 on July 1, 2025. The remaining balance from a check deposit may be held for a reasonable period, typically one to five business days. Larger check deposits exceeding $6,725, or those made into new accounts (under 30 days old), can experience extended hold periods, sometimes up to seven business days or longer, as allowed by Regulation CC guidelines.

When making debit card purchases, the funds are typically deducted from your available balance almost immediately. Although the transaction may appear as “pending” for a day or two while the merchant finalizes the charge, those specific funds are generally not usable for other purposes. This differs from credit card charges, where a pending charge reduces your available credit limit by reserving a portion of your credit line, not holding cash.

Your overall borrowing capacity is reduced by the pending amount until the transaction posts. For peer-to-peer (P2P) payment apps, funds received may show as pending while security checks are completed. While some apps allow immediate spending within their ecosystem, transferring these funds to an external bank account may involve a delay, often ranging from one to three business days, before they are fully settled and withdrawable.

Confirming Your Usable Balance

To determine the funds available for spending, check your “available balance” rather than the “current balance.” Financial institutions typically provide this information through their online banking portals, mobile applications, or automated phone systems.

Contacting your bank’s customer service directly can also provide clarification on specific pending transactions and their impact on your available funds. Understanding the difference between pending and cleared transactions helps prevent unintended overdrafts or declined payments. Regularly reviewing your available balance provides an accurate picture of your spending capacity.

References

1. Consumer Financial Protection Bureau.
2. Chase.