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What is the difference between settled balance and unsettled balance?

A settlement is the process of managing electronic payment transactions so they can clear and be funded. When a payment is submitted, it is sent to the issuing financial institution for authorization. At this stage, the transaction is said to be unsettled and will be added to your unsettled balance. Card issuers require a daily confirmation (via a settlement batch) for all transactions. When we send that daily confirmation to Visa, MasterCard or the appropriate payment brand, the payment brand does 2 things:

  • Issues a credit to Bolt at which point the funds are moved from your unsettled balance to your settled balance, making the funds ready for transfer to your bank account.
  • Issues a debit to the issuer to charge them for the settled transaction.
    The issuer then posts the transaction to the customer's/cardholder's account.

To summarize the funding flow:

  • payment -> funds are authorized and unsettled until the payment brand confirm the transaction
  • settlement -> transaction is settled and funds are ready to be transferred to your bank account
  • funding -> all currently settled transactions are transferred to your bank account
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