All About Next-Day Funding Merchant Account Services

All About Next-Day Funding Merchant Account Services

Nobody likes waiting to access money they have rightfully earned. Yet, that’s the situation the vast majority of merchants are forced to deal with on every single sale they make due to the standard funding holds imposed by most payment processors. Those processors’ merchant accounts don’t give merchants access to the funds from their sales immediately. Instead, funds are held for two, three, or in some extreme cases, even four business days before being deposited.

A few days might not sound like a big deal, but standard holds can cause big problems. Imagine a restaurant doing heavy sales on a Friday night. If that merchant is subject to a three-business day hold, they won’t see those funds hit their bank account until the following Thursday, almost an entire calendar week later! That’s a week in which expenses don’t stop accruing, emergencies can pop up, and interest isn’t being earned. Worse still, many merchants don’t understand why their money is being held which can make the entire situation even more frustrating. Luckily, there is a solution available to merchants partnering with certain payment processors, like BAMS, that eliminates that frustration and financial strain — next-day funding. 

Why Do Payment Processors Hold Funds?

Holds are a big annoyance, but they exist for a very valid reason. Card companies take on risk with every transaction because every credit card purchase is essentially a small loan, issued until the cardholder pays their bill. The most obvious risk is that the cardholder fails to pay their bill, but there are also a number of risks involving the merchant as well. Chargebacks, fraudulent transactions, and sudden business closures all put the card companies in a position where they could be exposed to a loss. The risk is shared by the payment processors who act as middlemen for the card issuers and are responsible for underwriting the merchants they issue accounts to. Payment holds exist to extend a level of risk mitigation and to ensure the necessary funds will always be available should a payment processor have to refund a transaction through no fault of their own, due to fraud or issues with the merchant.

How BAMS Next-Day Funding Gets Merchants Their Money Faster

Once a merchant has an established history of problem-free sales, it makes sense to offer them some reprieve from holds as a reward for their trustworthy operations. That’s exactly what BAMS does with next-day funding. BAMS merchants enrolled in next-day funding will see their eligible funds hit their bank account by 7:00 am the next business day – as little as 10 hours after a batch is processed. Next-day funding applies to all transactions batched by the 9:00 pm cutoff time, and any funds that miss that cutoff will be available just two business days later – still an improvement over the multi-day holds imposed by most payment processors.


Transactions batched before 9:00 pm on Wednesday -> Funds available by 7:00 am on Thursday

Transactions batched after 9:00 pm on Wednesday -> Funds available by 7:00 am on Friday

Transactions batched before 9:00 pm on Friday -> Funds available by 7:00 am on Monday

Transactions batched after 9:00pm on Friday through 9:00pm Sunday -> Funds available by 7:00am on Monday


How Next-Day Funding Impacts Your Business

Next-day funding is more than just a nice-to-have feature because it directly impacts a merchant’s cash flow and, in turn, the financial health of their business. From ensuring more immediate access to cash for short-term needs, to enabling more accurate forecasting and planning, to beefing up reserve funds for emergencies, next-day funding offers major benefits for established merchants looking to get more from their merchant services. That makes next-day funding a key feature business owners should look for when shopping for a new merchant account. 

Next-Day Funding Ensures Healthy Cash Flow

Cash flow is arguably the most critical factor in short-term success. Cash flow ensures a business can meet its obligations, even when unexpected expenses arise. Payroll, rent, variable costs, and debt repayments do not cease to exist when a business finds itself strapped for cash, making faster access to funds a big contributor to a merchant’s financial health, peace of mind, and overall success. Next-day funding ensures business owners will never face a situation in which they are forced to wait on the money they need to meet operating expenses. This is a huge benefit, especially during lean times like businesses around the country have faced during the COVID-19 pandemic. 

Next-Day Funding Enables Better Planning

Healthy cash flow and faster funding access do not only meet a merchant’s immediate needs. They also enable them to more confidently forecast their future financial situation, which in turn enables better planning. Something as simple as planning to bring on a new staff member or make a small capital purchase can be a daunting prospect for business owners who aren’t completely certain they’ll have the money they need on hand. Next-day funding ensures merchants will have a wider cushion on daily operating expenses, making forecasting and planning for both short and long-term growth less daunting and more accurate. 

Next-Day Funding Helps Provide a Safety Net

If there is one thing the COVID-19 pandemic has taught business owners the world over, it is the importance of having money put aside to keep the lights on when — not if — disasters or major emergencies strike. Having immediate access to cash from sales makes it easier for business owners to regularly build their emergency fund, ensuring that the next time they face a major disruption to their business from something completely out of their control, they’ll have the cash on hand necessary to ride out the storm. 


BAMS next-day funding is available to all of our qualifying merchants, and our 9:00 pm cutoff time is one of the latest in the industry, ensuring more of the funds from your daily transactions will be available for you the following morning. If you’re ready to find out more about how to get set up with BAMS next-day funding, or about how our guaranteed low pricing can save you money on your monthly merchant statements, get started with your custom five-point price comparison today.