(a) An item is finally paid by a payor bank when the bank has first done any of the
(1) paid the item in cash;
(2) settled for the item without having a right to revoke the settlement under statute,
clearing-house rule, or agreement; or
(3) made a provisional settlement for the item and failed to revoke the settlement
in the time and manner permitted by statute, clearing-house rule, or agreement.
(b) If provisional settlement for an item does not become final, the item is not finally
(c) If provisional settlement for an item between the presenting and payor banks is
made through a clearing house or by debits or credits in an account between them,
then to the extent that provisional debits or credits for the item are entered in
accounts between the presenting and payor banks or between the presenting and successive
prior collecting banks seriatim, they become final upon final payment of the item
by the payor bank.
(d) If a collecting bank receives a settlement for an item that is or becomes final,
the bank is accountable to its customer for the amount of the item, and any provisional
credit given for the item in an account with its customer becomes final.
(e) Subject to (i) applicable law stating a time for availability of funds, and (ii)
any right of the bank to apply the credit to an obligation of the customer, credit
given by a bank for an item in a customer's account becomes available for withdrawal
as of right if the bank:
(1) has received a provisional settlement for the item,--when the settlement becomes
final and the bank has had a reasonable time to receive return of the item and the
item has not been received within that time; or
(2) is both the depositary bank and the payor bank, and the item is finally paid,--at
the opening of the bank's second banking day following receipt of the item.
(f) Subject to applicable law stating a time for availability of funds and any right
of a bank to apply a deposit to an obligation of the depositor, a deposit of money
becomes available for withdrawal as of right at the opening of the bank's next banking
day after receipt of the deposit.
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.
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