How long does direct deposit take

By Nooreen B
Modified on April 21, 2023
How Long Does Direct Deposit Take

Waiting for your paycheck or a money transfer but not sure how long it will take? In most cases, a direct deposit will hit your bank account (doesn’t matter whether you use a retail bank vs. a credit union) anywhere between 12 a.m. and 6 a.m. the day that the money is sent out—depending on the kind of transfer. Curious about how the process works, where it is available, and how to set things up? Keep reading to learn all about the process.

What Is a Direct Deposit?

Direct deposit is the deposit of funds through an electronic transfer between bank accounts. The automated clearing house or ACH is the electronic network that allows for electronic bank transfers.

How It Works

It will work between two accounts, where one will be the depositor and the other the recipient. In order to receive funds, the recipient will need to provide the depositor with their bank account information, whether a business account or a personal checking account. Direct deposit makes it easy to send and receive funds on the same day.

It’s usually used for sending and receiving paycheck deposits, online quick cash direct loans, tax refunds, automatic bill payments, social security payments, retirement account payments, and investment payments. And so, chances are you have used direct deposit before and may not have been aware.

Does Direct Deposit Work For Online Bank Accounts?

Yes, they work for online bank accounts. Many e-banks have apps that individuals use to send money from one person to another or to a small vendor/small business.

Just like regular banks, direct deposit for e-banks works similarly. To use their services, you will have to attach a phone number or email along with your name to your e-bank account information. From here, you can then provide that basic contact information to send or receive funds from an individual. This connection makes it so you don’t have to give direct bank information to every individual you send or receive money through. Instead, the banks will store that information and use it with your consent.

How To Set Up Direct Deposit

To set up direct deposit, you will need to fill out the direct deposit form with your bank’s name, account number, and routing number. This information can all be found through the bank’s online platform or on a check.

How Long Does It Take to Set Up?

Once you submit the information, it will take a few business days to set up. It will be up to the recipient to set everything up with their bank. Once set up and cleared through an ACH, you can use the money immediately.

Below are a few timelines for how long it takes to set up for different payment types:

  • How Long Will It Take to Get My First Paycheck In My Bank Account?

As mentioned above, it can take a few days for employers to provide your direct deposit information to their bank and add you to payroll. However, this will usually not mean a delayed paycheck. Most businesses will ask for your direct deposit information, whether on the first day of you starting work or right after an offer. That way, once the time for your first paycheck comes, there is no wait time for ACH processing. And the funds can be deposited immediately after your employer issues them out.

  • Social Security, Unemployment and Other Benefits

Getting ongoing direct deposits from these benefits can be a little more complicated with setup. In many cases, you will have to renew your benefits before depositing the funds.

  • Paying Friends, Family Members, and Other Individuals

Setting up payments and receiving through e-banks is simple. Although these online banks can mean direct deposit and immediate funds, there may be, but there may be a fee or wait time to access them right away. Whether you want to use the funds directly with your debit card or withdraw the funds as cash, definitely consider the online bank you are working with.

Some Pros and Cons

Direct deposit comes with its sets of pros and cons for both individuals and businesses that use them. One advantage for both kinds of users is that direct deposit is faster, more convenient, safer, and more accessible than a check or cash deposit. Direct deposit provides easy and quick access to your funds and can help you control and schedule where your money is and how you use it. This ease of access is also one of the major benefits of opening up a checking account in the first place. 

One disadvantage that comes with direct deposit is that you will find that reversing a transaction can be extremely difficult and requires jumping through hoops, if possible at all. Additionally, suppose you change your bank account provider. In that case, you will have to update your account number and routing number with each direct deposit sender and receiver set up on your previous account.


In conclusion, once you set up direct deposit with a checking account you should be able to access the funds on the same day that they are sent out! This convenience and speed make it the first choice for payday deposits and more!

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