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What Is a Business Day in the U.S. and Internationally?

We hear that official work is conducted on business days or our package will be delivered in 4 business days. But every day is not a business day and this article thoroughly explains the concept of business days.

What is a Business Day?

Business Day

The business day means a well-known unit of time measure that refers to any day on which business operations and work are being conducted. In countries in the west, time from Monday to Friday between 9 a.m. to 5 p.m. (according to the local timeline) is usually considered to be a business day. This period excludes weekends and holidays, be it from the company or any festival. In the securities industry, a business day is said to be any day on which the financial market is open for trading and conducting business exchanges.

[Fast Fact

According to a thumb rule, there are said to be around 252 trading days in one year in the United States of America.]

Understanding Business Days

People not just in India or the West but all around the world face this issue of keeping in check the business days when they are submitting a check that needs to be clear from the side of the bank. Usually, depending upon the size of the check ( the amount of money that has been written) and the location from where the issuer issued the check affect the time that it takes to clear a check. It can take around two or more business days to clear a check, and an important thing that should be remembered by the consumer is that these 'two or more days don't include weekends and public holidays. Due to the time of the weekend or a public holiday, it can take more time to clear a check, and a depositor might have to wait longer to access those funds.

When a consumer or a company is conducting an international transaction, they need to be well aware of the business days that are followed in the particular country, as the business days vary.

Key Takeaways

Business Day
  • Business hours refers to a generally accepted period in which normal business work is being done by the people.
  • It is normally a period of Monday to Friday from 9 a.m. to 5 p.m. and doesn't involve holidays and weekends.
  • A lot of consumers often have to take care of the business days to have their work done, such as clearing a financial transaction, having a package delivered for any online site, and so on.
  • When someone is conducting an online transaction, he/she shall always consider the workweek of that particular country, as the holidays may differ depending upon the culture that is followed there.

Now, one might think that the business days are Monday to Friday globally, so why might one need to check the workweeks first while doing international transactions even though there is a basic rule for 40 hours per week, there is 3nough variation in other countries to make it necessary for consumers to be clear about the working days. Let us understand it with an example: If a person is doing business with a country in the Middle East, they should always keep in mind that they employ a Sunday to Thursday workweek, unlike ours from Monday to Friday. In some countries like Mexico, Columbia and India, the workweek is Monday to Saturday.

Business days are also utilized to convey messages about certain official work as when something will be taken care of it when the package will be delivered. For example, an online site might claim to deliver a certain package to be delivered in 6 business days, or mail may claim to be delivered within three business days. People always confuse three business days with three days, but that is not the case. Even if a package is said to be delivered in 3 business days, it might take 7 to 8 days to be delivered in case there is a weekend between the days.

Shifts and Trends

  • The coming up of flex time introduces the internet as a workplace that can be easily taken to a global level or offshore (from one country to other). The idea of a business day has developed a certain degree of challenge to it. The information-based companies don't rely much upon the use of physical goods and, thus, find it less worthwhile to separate a weekday from a weekend. And it is even true to a large extent for a lot of people as they think weekdays and weekends are the same. These kinds of companies have different ideas for a business day. That is, any day on which service is being provided by them is a business day.
  • There are some businesses out there that conduct business transactions and operations all the time and have a 24/7 work policy because of the nature of their work. For example, hospitals, hotels, police, and other rescue departments have stations and airports as well.
  • After the introduction of flex time in work fields, the importance of business days that went on from the late 19th century is declining. Even though the standard 8 hours work time remains intact in the industries, the trend is predicted to decline even more in the future years.
Business Day

Special Considerations

  • some other business day considerations arise when some multinational companies engage themselves in transactions all over the world, which demands the settlement of additional business days relative to the routine domestic transactions, more so if the countries that are being considered have different workdays than usual.
  • Different financial contracts and instruments consist of several different settlement periods.
  • The settlement periods for various financial contracts and instruments also vary widely, with some lengths requiring as little as one day, or T+1 in financial lingo, to others requiring three business days. Transaction settlement times are frequently determined by market sophistication and liquidity.
  • Since organizations and individuals can now conduct business virtually around the clock utilizing electronic methods, advancements in communication channels and capacities have blurred the conventional business day convention in many ways.

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