Clearing balance requirement

Financial institutions use the clearing balance requirement (or settlement balances requirement) to describe the amount of money or balance which they anticipate will be required to perform their clearing services.

Section VIII of the Reserve Maintenance Manual states:

"....A depository institution with a reserve balance requirement that has an account at a Reserve Bank may wish to hold balances above its requirement to facilitate its clearing needs. In all of these cases, the Federal Reserve encourages the depository institution to establish a clearing balance requirement."