The short answer
T+2 means funds settle into your merchant bank account 2 business days after the transaction date ("T" = trade date). Charge on Monday, funds available Wednesday. Standard settlement cycle for most US card processors including Stripe, Square, and Authorize.net.
In plain English
When a customer's card is charged, the money doesn't instantly appear in your bank. It moves through a sequence:
- T (day 0): authorization + capture. Your processor holds the charge.
- T+1: processor settles the batch with the acquiring bank.
- T+2: acquiring bank deposits into your merchant bank account.
Weekends and federal holidays extend the timeline. A Friday charge settles on Tuesday. A Wednesday before Thanksgiving settles on Monday.
How it shows up in your business
- Cash flow: you're always carrying 2 business days' worth of receivables.
- Holiday sales hit your bank 3-5 days after the transaction date.
- Refunds typically clear T+2 or faster — they return through the same pipe.
- High-risk merchants sometimes face T+3 or T+7 (acquirer-imposed longer cycles).
- Instant payout options exist on some processors (Stripe Instant Payouts, Square Instant Deposits) for ~1% fee.
Numbers to know
Standard T+2 across Visa + Mastercard merchant accounts. Some high-risk verticals run T+3 or T+7 by acquirer policy. European SEPA settlement can be T+1 or same-day. Instant-payout services typically charge 1-1.5% of payout amount for real-time availability.
Settlement windows can include rolling reserve holdbacks. T+2 + 10% rolling reserve = 90% of funds at T+2, 10% held 90-180 days then released.
Why multi-brand operators care
Across 4 brands on 4 merchant accounts = 4 settlement streams. Cash flow visibility fragments across 4 bank accounts. Consolidating to a parent merchant account gives you one settlement stream to your ops entity, then your ops entity's own ACH/wire process fans funds out to sub-entity accounts on your preferred cadence. multiflow surfaces the settlement timing + reserve status at the parent level so finance can model cash flow across the portfolio.