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Cash-in-transit (CIT) is a term that is used to describe situations in which actual cash money is in the process of being moved from one status to another. Similar to cash valuables in transit (CVIT), cash-in-transit may involve the physical cash being moved from one location to another, such as cash being removed from a bank vault and delivered to a business customer in an armored car. More frequently today, the term is used to describe the status of deposits or money transfers as the funds are moved from one account to another.
One of the more common examples of cash-in-transit has to do with the way that deposits are posted and made available to the account holders. Many banks require that deposits be received by a certain time of day in order to be posted as received on that same day. This means that if bank rules and regulations state that only deposits received in hand by 2:00 p.m. are posted the same business day, a deposit that is tendered at 3:00 p.m. will not actually be posted and made available to the account holder until the following business day. In fact, the deposit will show up on the account statement as a deposit for that following business day rather than the actual date of the deposit.
This same general approach applies to electronic transfers as well. If the account holder receives payment from an employer via direct deposit, the funds are immediately credited and available if the transfer is received by a certain time of day. Should the transfer be received after that deadline, it is noted but not actually posted to the account and ready for use until the following business day. During this time frame in which the deposit has been received but remains unposted to the account, it is said to be cash-in-transit.
The term does still apply to actual physical cash assets that are being moved from one location to another. Security companies often are engaged to manage this physical relocations of legal tender, such as making deliveries from a treasury location to a bank, or transporting cash from one branch of a given bank to a different branch located elsewhere in the city. Here, the cash-in-transit not only applies to the status of the cash as it is moved from one location to another, but also how quickly the funds are received and recorded in the bank records of the recipient.
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