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What is Memo Posting ?

MEMO POSTING – A notation posted to an account which indicates a credit has been received, but has not yet been posted to the account.

Memo-posting is a term used in traditional computerized banking environments where batch processing is employed. It represents temporary credit or debit transactions/entries made to an account for which the complete posting to update the balance will be done as part of EOD (end-of-day) batch processing. The temporary transaction created as part of the memo-posting will be reversed/removed after the actual transaction is posted in batch processing. Some modern banking systems implement real-time posting.

When you conduct a transaction at your bank, the teller “posts” the transaction to your account so that your current balance reflects the deposit or withdrawal. At my bank, this transaction is called a memo-postbecause it is pending approval. At the end of the business day, the paperwork for each transaction is put through processing. This is where a team of people and technology review the transactions for accuracy. If no corrections are needed, the transaction is then hard-posted to the account and is no longer considered a pending transaction.

The process of hard-posting begins at the end of the business day. Business days are determined as Monday through Friday, with the exception of federal banking holidays (i.e. Memorial Day and Christmas). The end of the business day is determined by a financial institution’s cut-off time.

Cut-off times designate when that day’s processing begins, and mark the “rollover” to the next business day. Cut-off times vary depending on your bank and city. Banks will often remain open past its cut-off time, which is why it is important to be aware of the change in business day, especially if trying to avoid an overdraft fee or negative account penalty.

Free Merchant Terminal Explains MEMO POSTING :

  • A customer receives an electronic credit to his account with the current day as the effective date. The actual transaction for this entry will be made at EOD in batch posting. In order for him to access the electronic credit for which he is eligible, the bank creates a temporary “memo” credit to increase the balance available (withdrawal). Later, this entry will be removed as part of the EOD batch process.
  • The actual transaction to record a withdrawal using ATM will be posted to accounts in the EOD batch. In order to prevent a customer from overdrawing his account later in the day, the amount of the cash withdrawal is memo-posted as a charge to his account until the transaction actually posts in the batch update that evening.


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