Counter Credits Explained

Despite the advent of digital banking and managing your finances on a screen, many people still step inside a brick-and-mortar bank to make a deposit. When they do, this transaction may turn up on their monthly statement as a “counter credit.” The reason why: They approached the counter at the branch and handed over funds that were credited to their account.

Here, learn more about counter credits and the role they can play in your financial life.

What Is a Counter Credit?

A counter credit is a cash or check deposit made to your checking or savings account in person at a brick-and-mortar branch of a bank or credit union. In that way, it’s really the most straightforward, traditional kind of deposit you can make.

This counter credit meaning is pretty narrow: It doesn’t include deposits made at an ATM, it doesn’t include mobile check deposits, and it certainly doesn’t include direct deposits from an employer. It has to be in person, at a bank, and with a teller.

As briefly noted, it’s called counter credit because you make the deposit at the counter inside the branch, and the teller then credits your account the amount you deposited. (If you withdraw money at the counter, it should show up on your bank statement as a counter debit.)

How Do Counter Credits Work?

Don’t let the unfamiliar terminology fool you: You’ve likely made a counter credit before. You simply enter your bank and then hand the money or check to a teller.

If you use a deposit slip from your checkbook, you can just add the date and the amount of money. If you use a bank’s blank deposit slip, it will require you to know your bank account number. If you don’t know it, don’t sweat it: Just take the slip to the teller and show your ID, and the teller should be able to help you with the rest.

Or, you may well be able to skip the deposit slip altogether. Often, just having your debit card and PIN handy will be enough to move the transaction ahead with the teller.

How Long Does a Counter Credit Take to Clear?

Cash deposited via counter credit should be available in your bank account quickly; sometimes almost immediately, especially with small sums. At other times, the funds may clear within a business day. This makes it an attractive way to deposit your funds. Worth noting: Large cash deposits may take longer to clear.

Check deposits can take a little longer, whether made at the counter or via mobile deposit. Typically, a domestic check takes one or two business days to clear. Checks for large sums or drawn on international banks may take longer.

Recommended: How Long Does Direct Deposit Take?

Why Do Counter Credits Appear on Bank Statements?

Your bank statement gives a complete picture of account activity during a statement period (usually a month). Every transaction and transfer is accounted for.

Because counter credits are a type of deposit to your account, a bank will include them. Labeling them as counter credits can make it easier for you to identify which deposits were made in person vs. other deposits, like mobile check deposits, ATM deposits, and direct deposits from an employer, a company (like an insurance company depositing a payout), or the government.

How Do You Make Counter Deposits?

As noted above, counter deposits occur when an account holder gives a deposit to a teller at the counter of a bank branch. The customer might use a deposit slip, filled out with account details, or they might swipe their debit card and enter their PIN. This process allows the teller to ensure that the deposit is going to the intended account.

Typically, the bank customer will get a paper receipt, showing that the deposit was accepted.

Although the deposit is handed off in person, typically a check will be verified and processed before the funds are fully available. This can take a couple of business days or sometimes longer. A cash deposit, on the other hand, usually clears within a day, though a large deposit can take longer.

Deposits vs. Counter Credits

Counter credits are a type of deposit. Thus, all counter credits are deposits, but not all deposits are counter credits.

In today’s world of advanced banking technology, you can deposit money into your account in a number of ways:

•  Direct deposit: A third party, like an employer with your paycheck or the federal government with a tax refund or unemployment payment, will electronically transfer money into your account.

•  Other electronic funds transfers: Other forms of electronic fund transfers that you might use to deposit money into your account include transferring money from one bank to another or moving money from a peer-to-peer payment app into your bank account after a friend sends you money.

•  Mobile check deposit: Mobile banking technology enables consumers to take pictures of their checks on their phone, from the comfort of their own home, then deposit them via the bank’s app.

•  ATM and retailer deposits: You can often deposit money to your bank account at an ATM or participating retailer. When depositing cash at an ATM, it can be a good idea to find an in-network ATM to avoid paying ATM fees. However, be aware that not all online banks support cash deposits at ATMs and may instead allow you to make these deposits at participating retailers, which could impose a small fee. (SoFi, for example, only supports cash deposits at participating retailers at this time.)

As you see, counter credits are just one of many techniques that can be used to get money into your bank account.

Recommended: What Is a Cashier’s Check?

Is Counter Credit Obsolete?

With more people using online banking, you might think counter credit is obsolete. However, in-person banking still has its place.

Some people just prefer the customer experience of walking into a bank and working with another human to deposit their funds. A counter credit can also be reassuring when you’re depositing a large sum of cash and don’t want to feed it into an ATM.

Pros and Cons of Counter Credits

What are the advantages and disadvantages of counter credits? Consider these points.

Pros

The upsides of counter credits are as follows:

•  Quick access to funds: When depositing a check or cash, the money is often available in your bank account soon thereafter, especially when depositing cash. There’s no need to wait for, say, the ATM you deposited your money into to be emptied.

•  In-person customer service: If you need help, the bank teller is literally right on the other side of the counter — and should be happy to assist you.

•  Ideal for large deposits and people who use cash: Some people who work primarily with cash and make large deposits may prefer to hand the cash or check directly to the bank teller. This can be a positive when an ATM or retailer deposit may be less practical (and might have deposit limits).

•  Easy to understand: People who have grown up with tech may argue that digital deposits are easier and more convenient, but if you’re not comfortable with these technologies, it may be simpler for you just to head to the bank and deposit money in person.

Cons

Next, review the downsides of counter credits:

•  Inconvenience: For many, the thought of driving to a bank and waiting in line in person is wildly inconvenient in this era of digital banking.

•  Inaccessible when traveling: Whether you are a digital nomad or simply traveling on your summer vacation, sometimes you simply can’t get to a bank branch. Mobile deposit (or signing up for direct deposit to automate the process) can help eliminate this issue.

•  Limited hours: Banks aren’t always open. They close in the evening, they may have short Saturday hours (if any), and they’re closed for holidays. But with online banking, you can make a mobile deposit any time of day (and often in the evenings at participating retailers).

Recommended: Online Banking vs. Traditional Banking

The Takeaway

Counter credits refer to in-person deposits (check or cash) into your bank account, made at a brick-and-mortar location. If you bank in person at a traditional bank, it’s likely you’ll see these transactions on your monthly bank statement. However, with the advent of online banking, you may make all or most of your deposits via functions like mobile check deposit and electronic fund transfer, as well as at participating ATMs and retailers.

If you don’t have a need for in-person banking, consider the benefits of an online bank account with SoFi. Note that SoFi does not currently support cash deposits at ATMs, though it enables you to make cash deposits at participating retailers nationwide for a small fee.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

Is counter credit a direct deposit?

A counter credit is not a direct deposit. A counter credit refers to an in-person deposit made by you at your bank’s counter with a teller. A direct deposit is an electronic process in which a third party, like an employer or the government, transfers money directly into your bank account.

What is a counter transaction?

A counter transaction is a banking transaction made in person with a bank teller at the counter of a brick-and-mortar branch. This might include depositing money (a counter credit) or withdrawing money (a counter debit).

What is an over-the-counter deposit?

An over-the-counter deposit (aka a counter credit) is a cash or check deposit made into a bank account in person at a bank or credit union branch. The counter refers to the counter at which the bank teller works. You may see counter credits on bank statements referencing these transactions.

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SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

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