Working capital and settlement time
A sale is not cash until it lands in your bank account. The days in between, and the weekends that stretch them, decide how much money is tied up at any moment and how close your balance runs to zero on payroll day.
Key points
- Money in transit is working capital you have earned but cannot yet spend.
- Bank rails settle on business days, so a Friday sale can wait until Monday or later.
- On-chain transfers move every day, but the bank withdrawal at the end still follows business days.
- Settlement timing and fees both shape your cash position; separate the two when comparing rails.
Money in transit is money you cannot use
Every rail has a gap between the moment a customer pays and the moment the funds are usable in your operating account. Multiply your daily sales by the number of calendar days in that gap and you have the amount that is always in transit.
That balance has a cost even when no one charges you for it. If you borrow on a line of credit, or would otherwise earn a return on the cash, the money in transit carries a carrying cost. This site prices it at a cost of capital you choose, 8% a year by default, and reports it as float cost.
Business days, calendar days and weekends
Settlement promises are usually stated in business days, but your bills arrive on calendar days. Two business days become four calendar days when the sale lands on a Thursday, while an Interac e-Transfer for business payment is assumed to arrive the same day. Averaged across a week, the default assumptions translate as follows. These defaults are illustrative, not market data, and statutory holidays are not modelled.
| Rail | Stated settlement | Average calendar days |
|---|---|---|
| Card (online) | 2 business days | 2.8 |
| Interac e-Transfer for business | Same day, every day | 0 |
| EFT / pre-authorized debit | 3 business days | 4.2 |
| Wire | 2 business days | 2.8 |
| USD-referenced stablecoin | 1 business day for the bank withdrawal | 1.4 |
| Native crypto-asset via a processor | 1 business day for the payout | 1.4 |
A stablecoin transfer can confirm on a Saturday, but converting to CAD and withdrawing to a Canadian bank account still runs on banking days in this model. See on-chain settlement and finality.
Worked example: 60 days of cash
The settlement cash-flow simulator plays out a business day by day. In this illustration the business starts on November 2, 2026 with $15,000 in the bank. It sells $2,000 on a typical weekday and 60% of that on weekend days. It pays $12,000 of payroll every 14 days, $6,000 to suppliers every Thursday and $4,500 in fixed costs on the first of each month. We ran the same 60 days three times, with every sale on a single rail, using the default rail assumptions.
| Measure | All card | All EFT | All stablecoin |
|---|---|---|---|
| Average money in transit | $4,902.06 | $7,232.45 | $2,756.83 |
| Peak money in transit | $6,167.73 | $8,276.92 | $4,332.17 |
| Lowest balance | $3,932.13 | $3,497.96 | $7,420.83 |
| Date of lowest balance | December 25, 2026 | December 13, 2026 | December 11, 2026 |
| Fees over 60 days | $3,890.47 | $1,620.70 | $1,652.67 |
| Ending balance | $7,954.70 | $8,167.21 | $12,078.17 |
Reading the simulation
Look at the dates first. In the card and stablecoin runs, the lowest balance falls on a payroll day. In the EFT run it falls on Sunday, December 13, two days after a Friday payroll, because weekend sales are still waiting for business-day settlement while payroll has already left the account.
Next, separate timing from cost. EFT has the lowest fees here but the most money in transit, so its ending balance is only a little above the card run. The stablecoin run ends highest because it combines lower fees than card with the shortest settlement in this model. Your own numbers depend on your fees, your mix and when your bills fall due.
None of the three runs goes below zero, but the gap between the lowest balance and zero is the buffer that matters for a line of credit or an overdraft. The CFO guide looks at how finance leads frame this buffer.
Shifting part of the mix, not all of it
A business rarely needs to move all its sales to one rail to see an effect. The mix comparison shows what a partial shift does. Suppose a business with $50,000 a month of sales, an average ticket of $120 and 15% cross-border customers takes 80% by card and 20% by Interac e-Transfer today, and considers moving a quarter of its card volume to a USD-referenced stablecoin (60% card, 20% Interac e-Transfer, 20% stablecoin).
Under the default assumptions, money in transit falls from $3,873.33 to $3,406.67, releasing about $467 of working capital. At an 8% cost of capital that is worth about $37 a year. The fee difference is larger: estimated annual payment costs fall from $19,781.75 to $17,276.75, about $2,505 a year. In this illustration, faster settlement matters more for the size of the cash buffer than for the float cost itself.
The merchant scenario builder lets you set your current and proposed mix, volume and cost of capital side by side.
What the model leaves out
A simulation is only as good as its assumptions. Check these against your own contracts before drawing conclusions.
- Statutory holidays, which extend business-day settlement further.
- Daily cut-off times, after which a payment counts as the next business day.
- Rolling reserves or holds a provider may place on new accounts.
- Conversion timing: if you hold a native crypto-asset before converting, price movement adds exposure; see price volatility and conversion.
- Payments Canada's planned Real-Time Rail, which targets a Q4 2026 launch; it is not modelled because it is not yet live as of October 30, 2026.
Questions people ask
What is float cost?
It is the money in transit multiplied by your cost of capital, expressed as a monthly or annual amount. It is an opportunity cost, not a fee anyone charges you.
Do stablecoin payments settle on weekends?
The on-chain transfer can confirm on any day. In this model, converting to CAD and withdrawing to a Canadian bank still follows business days, so usable cash arrives on the next banking day.
Why does EFT tie up more cash than card in the example?
The default assumption is three business days for EFT against two for card, so more sales are waiting to settle at any moment, even though EFT fees are lower.
Does faster settlement always mean a better cash position?
Not on its own. Fees, payment timing and when your bills fall due all matter, which is why the simulator shows both the lowest balance and total fees.
Sources
Reviewed October 30, 2026. Educational information only; not financial, legal, tax or investment advice. This site does not process payments or hold funds.