What is a Non-sufficient funds(NSF)?
Every now and then on your bank statement you may see NSF. This is used by the bank to determine that a cheque or payment could not be honoured because the funds were not available in the account for withdraw. To be simplified an easy way to explain this is the cheque bounced. The NSF cheque is often refered to as a dishonored cheque/payment or bounced check, cold cheque, rubber cheque, returned item or hot check.
What are the consquences of a NSF Cheque?
- Depending on your banks policy your account may be subject to an NSF fee. This fee can range depending on the status of your account and how much was attempted to be withdrawn
- Depending on the size of the amount being withdrawn the bank may look past the fee and have you pay the overdraft later on.
- If your account is unreliable your bank may choose to hold the cheque and have it sorted out person to person to avoid any confusion but may result in a larger fee
- If the NSF fee is common to your account it may be submitted to places like TeleCheck, Shared Check Authorization Network(SCAN) or ChexSystems. Try to avoid this at all costs.
- Some businesses may choose to not accept cheques from you if to many bad ones are received.