Payments - Life of a Card Transaction

You tap your card at a coffee shop and the screen says "approved." Feels like the money just left your account. It didn't. That approval is a promise. The store has zero of your dollars at that point.

Settlement

Later that night, the store bundles every sale into one batch and sends it off. Over the next day or two, that money crawls back through a chain of banks, each one taking a small cut before it lands in the store's account. That slow trip is called settlement. Want to feel how slow it is? Try running the shop yourself below.