clearing bank

Definition

A commercial bank that is part of a network of banks that can clear checks for its clients regardless of whether or not the check originates from the same commercial bank. Clearing a check means processing it so that funds are deducted from the payer's account and put into the payee's account.

Use clearing bank in a sentence

Most banks are said to be a clearing bank because you can get a check cleared, no matter where that check originates from, as long as you are a member of that bank.

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clearing account bank giro