Economics, the science of money, is complex, and banking in this system is just as complicated. If you haven’t gone through the school for this job or if you don’t work in this industry, you may be confused about many issues as there are some unique terms. One is value. This term, which is mainly seen as a value date, It is used this way because it describes the time between the transaction statement and its execution.
Terms such as value date and value date are generally used to indicate the commencement date of an interest or loan. Because there is a time between the execution of a transaction and its realization. After all, the BRSA offers new programs by making some adjustments to the value date from time to time. Bride What does the value mean and how is it calculated? Let’s look at the most frequently asked questions in detail.
Let’s start with the basics, what does value mean?
This word, which is of French origin, has passed into our language as value and into English as value. To translate directly, value means value. Generally In interest-bearing transactions, the effective date is referred to as the value date. While it refers to the next business day in credit transactions, it refers to that day in debit transactions. Of course, it can vary by application.
What does the more commonly used value date mean?
In fact, we can call the actual use of the value date for the value date. Because it is generally used in the banking industry in the form of a value date. The first day or the next day on which interest starts to accrue available in different applications.
For example, you went to a bank and wanted to open a term account. You have deposited the money and the account has been opened. Even if it varies according to the bank’s policies, interest generally begins to accrue the next day. That day is the value date. If interest starts accruing the next day, that is the value date.
Examples of value dates:
- The difference in days between the opening of the account and the date on which term deposit interest begins to accrue.
- For money transfers, the difference between the date of the transfer order and the transfer to the other account.
- The day on which the interest on the loan starts.
So what does sports value mean?
Although it is used in English as spot date, this term which is known as sports value in our language is means that the data will be instructed in bank transactions two days later. That is, the transaction is instructed to take place two days after the business day, not that day or the next day.
Necessary documents for financing and similar transactions, or check some conditions There are special procedures such as Since it takes a certain amount of time to comply with these procedures, the value date is determined to be two days later. For example, if a transaction was entered on Monday with the value sport value, it would take place on Wednesday.
The sports value is generally two days, but depends on the status of the transaction. Sometimes this period can be three days. In that case, an extension of the value date may result in a change in the interest calculation. For example, if you get three days as a sports value period on a 32-day account, the calculation will be made over 35 days.
Another situation that differs from bank to bank is a transaction with and without a value date. According to transaction status Sometimes the transaction can take place without wasting time. This change is experienced in accordance with the amount of money. Since even one day of value date can make a big difference in very large amounts, an arrangement is made for this.
You may encounter the value date on the receipt:
About the value date by the Bureau Regulations and Supervision Banks BRSA occasionally appointments are made. we told you. For example, there was a one-day value rule for foreign exchange transactions above 100 thousand dollars and gold transactions above 100 grams. In other words, such a transaction could not be executed until a day later.
You could see this information after such a transaction on the receipt you received with a current value. It’s different, even if the rule changes You may still encounter this information because different value dates are used in transactions. Unfortunately, this sometimes causes confusion.
Let’s get to the most curious topic; How is the value calculated?
There is a simple formula you can use for value calculation;
number of days the money is invested in interest / number of days with value x bank interest rate
Let’s say you put your deposit in the bank for 30 days at 11 percent interest and 1 day value. When we apply the formula, we come across the ratio 30 / 31 x 11 = 10.6. This means that the money you deposit in the bank with a value of 1 day for 30 days. the interest return is not 11 percent, but 10.6 percent.
Since the value calculation is already automatically calculated by the bank, many users are not interested in this calculation process and formula. However if you know the value calculation You can protect the value of your money by making much more advantageous deals when opening a term account, buying and selling, paying off loan debt and similar transactions.
Why is a value applied?
The reason for the introduction of the value date and similar decisions by the BRSA, the Banking Regulations and Supervision Agency, control of financial instruments. With the application of the value date, the financial institution begins to pay interest after the value date. This practice becomes a successful control mechanism, especially where deposits are large enough to influence the market.
When such a transaction is due, the person will be notified of the application of the value date with a warning such as “It will be applied with a value date of one business day”. In this way, debt, loan and interest transactions are arranged. For example, with EFT transactions you may come across a value date. EFT value date means when the money is transferred to the other party’s account. In other words, the instruments of both financial institutions are prepared for this.
A term used in banking what is the value date, what is the value date, what is the sport value date We’ve talked about the details you need to know about this funding application by answering frequently asked questions. What we tell you may vary depending on current regulations or bank policies.
Source: Web Tekno
Alice Smith is a seasoned journalist and writer for Div Bracket. She has a keen sense of what’s important and is always on top of the latest trends. Alice provides in-depth coverage of the most talked-about news stories, delivering insightful and thought-provoking articles that keep her readers informed and engaged.