How quickly do domestic card transactions typically settle?

Domestic card transactions typically settle one day after the transaction date due to the efficient processes established within the payments ecosystem. When a card transaction occurs, the transaction details are communicated swiftly between the cardholder's bank (issuing bank) and the merchant's bank (acquiring bank).

After this initial authorization, funds are usually transferred and settled the following business day. This means that while the transaction may be completed immediately at the point of sale, the actual movement of funds and reconciliation in the banks' systems typically takes one day. This one-day settlement cycle allows for a balance between prompt payment processing and the necessary time for clearing and settlement among financial institutions involved in the transaction.

In instances where different banks are involved, or if the transaction occurs after banking hours or on weekends, you may sometimes experience delays, but the standard is still a next-day settlement.