The word "clear" applied to cheques in Ireland has a variety of meanings. Most countries who use cheques have a "Clearing house" - a specialist organisation which performs the clearing operation. Ireland does not. The clearing arrangements are managed by the Irish Paper Clearing Company, one of the IPSO group of companies, but the actual clearing operations are performed by the banks among themselves.
In the old days, a cheque had to be presented at the branch on which it was drawn before a decision could be made on whether it would be paid or bounced. The drawers bank could delay such a decision until close of business on the day following presentment, if the cheque was presented through the clearing system (as opposed to presentation over the counter). If it was presented over the counter, such a decision would be made immediately, and the payee could obtain funds immediately.
Nowadays, many banks treat their branch network as if it was a single branch, and so a cheque presented in branch A, drawn on branch B of the same bank might be paid immediately.
However, the story is different if it is drawn on another bank.
If a Bank of Ireland, Newbridge cheque for €500 is lodged in PTSB, Dundrum, on say a Thursday, then the following is a possible sequence of events:-
Thursday.... €500 is credited to your account with an "uncleared" flag
Friday........ Morning - cheque arrives in PTSB clearing department, is sorted, and is delivered to Bank of Ireland as an item in the morning exchange of cheques. ....Friday afternoon... PTSB and Bank of Ireland settletheir clearing account through the Central Bank --including this €500
Monday.... Morning- cheque is presented to the payers account at Newbridge. If the account has adrquate funds, then the cheque may be paid. If not, then the payment is deferred for a day.
Tuesday... Deferred cheque is again presented for payment. If there are not adequate funds, then the cheque is returned to PTSB Dundrum as a bounced cheque.
Wednesday.. PTSB receives the bounced cheque in the post, and a notification that Bank of Ireland wants to recoup the amount. PTSB debits your account (a) with the amount of the cheque (€500) and (b) with a charge for all of the administration involved. IF PTSB does not receive such a bounce and notification, then it will remove the "uncleared" flag.
Some banks as mentioned in previous posts dispense with such flagging arrangements for customers who have established a proven record.
editor -