Lock Deposit Amount Feature

Business Overview

The Lock Deposit Amount feature allows banks to place holds on customer funds, temporarily restricting access to a specified amount while keeping it in the account. This essential banking capability supports various operational and regulatory requirements.

Image placeholder: Diagram showing account balance vs available balance with locked amounts

What is an Amount Lock?

An amount lock (also called a hold or block) temporarily restricts a portion of an account balance from being withdrawn or transferred. The money remains in the account, but customers cannot access it until the lock is released or seized.

Real-World Examples

Example 1: Card Payments

When a customer uses their debit card at a gas station:

1. Station authorizes $100 hold on the card
2. Bank locks $100 from the customer's account
3. Customer pumps $75 worth of gas
4. Station settles for $75
5. Bank releases the remaining $25 hold

Example 2: Check Deposits

When a customer deposits a check:

1. Bank credits the account with check amount
2. Bank places a hold on the deposited amount
3. Check clears after 2-3 business days
4. Bank releases the hold, making funds available

Example 3: Legal Requirements

When a court orders funds frozen:

1. Court issues hold order
2. Bank locks specified amount
3. Funds remain in account but unavailable
4. Lock remains until court releases order

Key Benefits

For Financial Institutions

• Risk Management: Protect against overdrafts and payment reversals
• Regulatory Compliance: Meet legal and regulatory hold requirements
• Fraud Prevention: Lock suspicious transactions pending investigation
• Operational Efficiency: Automate hold management processes

For Customers

• Transparency: Clear view of available vs total balance
• Protection: Prevents accidental overdrafts on pending transactions
• Convenience: Seamless experience for card and check transactions

Feature Capabilities

Flexible Lock Management

• Lock any amount from any deposit account
• Support for multiple concurrent locks per account
• Each lock tracked with unique reference
• Optional overdraft capability for authorized accounts

Comprehensive Tracking

• Unique reference number for each lock
• Detailed reason/description for audit purposes
• Complete transaction history
• User and timestamp tracking

Balance Management

• Maintains actual account balance
• Automatically calculates available balance
• Supports overdraft scenarios when configured
• Real-time balance updates

How It Works

Step-by-Step Process

Step 1: Initiate Lock Request

User initiates a lock through the banking system:

• Account: Customer's deposit account
• Amount: How much to lock
• Reference: Unique identifier for the lock
• Reason: Why the lock is being placed

Image placeholder: Screenshot of lock request form

Step 2: System Validation

System performs automatic checks:

✅ Account exists and is active ✅ Account is not frozen or dormant ✅ Lock reference is unique ✅ Sufficient balance available (if required)

Step 3: Create Lock

If validation passes:

• System creates the lock record
• Reduces available balance
• Maintains actual balance
• Generates transaction reference

Step 4: Confirmation

System provides confirmation:

• Lock reference number
• Transaction ID
• Updated available balance
• Lock details for records

Image placeholder: Screenshot showing successful lock confirmation

User Interface Walkthrough

Creating an Amount Lock

Navigation

1. From the main menu, navigate to Deposits → Transactions
2. Select Lock Amount from the transaction menu
3. Enter the account number or search for the account

Image placeholder: Screenshot of navigation path

Lock Details Entry

Required Information:

Field	Description	Example
Account Number	Customer's deposit account	2000123456
Lock Amount	Amount to lock	50,000.00
Block Reference	Unique identifier	CARD-AUTH-20241217-001
Lock Reason	Purpose of the lock	Card authorization hold

Optional Settings:

• Allow Negative Balance: Check this box for overdraft-enabled accounts

Image placeholder: Completed lock entry form

Review and Confirm

Before submitting, review:

• Account holder name
• Current available balance
• Lock amount
• Resulting available balance after lock

Image placeholder: Lock review and confirmation screen

Success Confirmation

Upon successful creation:

• Transaction reference number displayed
• Block reference confirmed
• Available balance updated
• Option to print receipt

Image placeholder: Success confirmation message

Balance Impact Illustration

Before Lock

┌─────────────────────────────────┐
│     Customer Account            │
├─────────────────────────────────┤
│ Account Balance:    100,000.00  │
│ Blocked Amount:           0.00  │
│ Available Balance:  100,000.00  │
└─────────────────────────────────┘

After Locking 30,000.00

┌─────────────────────────────────┐
│     Customer Account            │
├─────────────────────────────────┤
│ Account Balance:    100,000.00  │ ← Unchanged
│ Blocked Amount:      30,000.00  │ ← Increased
│ Available Balance:   70,000.00  │ ← Reduced
└─────────────────────────────────┘

Multiple Locks Example

┌─────────────────────────────────────────┐
│     Customer Account                    │
├─────────────────────────────────────────┤
│ Account Balance:        100,000.00      │
│                                         │
│ Locks:                                  │
│  • CARD-AUTH-001:        15,000.00      │
│  • CHECK-HOLD-002:       25,000.00      │
│  • LEGAL-HOLD-003:       20,000.00      │
│                          ───────────    │
│ Total Blocked Amount:    60,000.00      │
│ Available Balance:       40,000.00      │
└─────────────────────────────────────────┘

Common Use Cases and Scenarios

Scenario 1: Card Authorization Hold

Business Context:

Customer makes a hotel reservation using their debit card. The hotel places an authorization hold.

Process:

1. Day 1 - Check-in:

   • Hotel requests $500 authorization
   • Bank locks $500 from customer's account
   • Customer's available balance reduced by $500

2. Day 3 - Check-out:

   • Actual bill is $450
   • Hotel settles for $450
   • Bank seizes $450 (actual charge)
   • Bank releases remaining $50

Configuration:

• Lock Amount: $500.00
• Reference: HOTEL-AUTH-20241217-001
• Reason: "Hotel authorization - ABC Hotel"
• Allow Negative: No

Image placeholder: Flowchart of card authorization hold process

Scenario 2: Check Clearing Hold

Business Context:

Customer deposits a check from another bank. Bank places hold pending clearance.

Process:

1. Day 1 - Deposit:

   • Customer deposits $10,000 check
   • Bank credits account with $10,000
   • Bank locks $10,000 pending clearance

2. Day 3 - Clearance:

   • Check clears successfully
   • Bank releases the $10,000 hold
   • Funds become available to customer

Configuration:

• Lock Amount: $10,000.00
• Reference: CHK-HOLD-20241217-001
• Reason: "Check hold pending clearance - Check #1234"
• Allow Negative: No

Scenario 3: Legal/Court Order Hold

Business Context:

Court issues order to freeze funds in a customer account pending litigation.

Process:

1. Receive Court Order:

   • Legal team receives court order
   • Order specifies $50,000 hold

2. Execute Hold:

   • Compliance officer creates lock
   • System locks $50,000
   • Detailed reason entered for audit

3. Release:

   • Court issues release order
   • Compliance releases lock
   • Funds become available

Configuration:

• Lock Amount: $50,000.00
• Reference: LEGAL-CT-2024-789
• Reason: "Court order - Case #CT/2024/789 - District Court"
• Allow Negative: No

Image placeholder: Legal hold workflow diagram

Scenario 4: Loan Collateral Hold

Business Context:

Customer applies for a loan and provides cash collateral from their savings account.

Process:

1. Loan Application:

   • Customer applies for $100,000 loan
   • Bank requires 20% cash collateral

2. Place Collateral Hold:

   • Bank locks $20,000 from savings account
   • Holds remain until loan is repaid

3. Loan Repayment:

   • Customer repays loan in full
   • Bank releases collateral hold
   • Customer can access funds

Configuration:

• Lock Amount: $20,000.00
• Reference: LOAN-COLLATERAL-LA-001-2024
• Reason: "Loan collateral for loan account LA-001"
• Allow Negative: No

Managing Existing Locks

Viewing Account Locks

Access the lock management interface to view all locks on an account:

Information Displayed:

• Lock reference number
• Lock amount
• Creation date/time
• Created by (user)
• Lock reason
• Status (Active/Released/Seized)

Image placeholder: Screenshot of account locks list

Lock Actions

Releasing a Lock

When to Release:

• Transaction is cancelled
• Authorization expires
• Check bounces
• Court order is lifted

Process:

1. Navigate to account locks
2. Select the lock to release
3. Click "Release Lock"
4. Enter reason for release
5. Confirm action

Result:

• Lock status changes to "Released"
• Available balance increases
• No debit to account

Image placeholder: Screenshot of release lock dialog

Seizing a Lock

When to Seize:

• Transaction settles
• Check clears
• Payment processes
• Fees need to be collected

Process:

1. Navigate to account locks
2. Select the lock to seize
3. Click "Seize Lock"
4. Enter service details (if applicable)
5. Confirm action

Result:

• Lock status changes to "Seized"
• Amount is debited from account
• Actual account balance decreases

Image placeholder: Screenshot of seize lock dialog

Reporting and Monitoring

Available Reports

Active Locks Report

Shows all current locks across all accounts:

• Total locked amounts by type
• Aging analysis of locks
• Locks by user/branch
• Unusual or high-value locks

Image placeholder: Screenshot of active locks report

Lock History Report

Historical view of all lock operations:

• Created, released, and seized locks
• Time-to-resolution metrics
• Lock lifecycle analysis
• Audit trail

Exception Reports

Highlights issues requiring attention:

• Locks exceeding age thresholds
• Large-value locks
• Multiple locks on single account
• Failed lock attempts

Key Performance Indicators

Operational Metrics:

• Average lock duration
• Lock-to-release ratio
• Lock-to-seize ratio
• Daily lock volume

Risk Metrics:

• Total locked amounts by branch
• Percentage of balance locked
• Aging of long-standing locks
• Failed lock attempts

Troubleshooting Guide

Common Issues and Solutions

Issue: "Duplicate Block Reference" Error

Problem: System rejects lock with duplicate reference error

Cause: Block reference already exists for this account

Solution:

1. Check existing locks on the account
2. Verify the lock you're trying to create doesn't already exist
3. If legitimate duplicate scenario, add sequence number:
   • Original: CARD-AUTH-20241217-001
   • Next: CARD-AUTH-20241217-002

Issue: "Insufficient Balance" Error

Problem: Cannot create lock due to insufficient balance

Cause: Available balance is less than lock amount

Solution:

1. Check account's current available balance
2. Review existing locks on the account
3. Options:
   • Reduce lock amount
   • Release unnecessary existing locks
   • For overdraft accounts, use "Allow Negative Balance" option

Issue: "Account is Locked" Error

Problem: Cannot create lock on frozen/locked account

Cause: Account has operational restrictions

Solution:

1. Check account status (frozen, dormant, locked)
2. Remove restriction if appropriate
3. Contact account administration for locked accounts
4. For legal holds, obtain proper authorization

Issue: Cannot Find Lock to Release

Problem: Lock not visible in lock list

Cause: Lock may be already released/seized, or searching wrong account

Solution:

1. Verify you're viewing correct account
2. Check lock history, not just active locks
3. Verify block reference spelling
4. Check if lock was created on different account

Training Recommendations

New User Training

Duration: 30 minutes

Topics:

1. Understanding locks vs actual debits (10 min)
2. Creating locks - hands-on practice (10 min)
3. Releasing and seizing locks (5 min)
4. Common scenarios and examples (5 min)

Hands-On Exercises:

• Create a card authorization hold
• Release an expired hold
• Seize a settled transaction
• View and interpret lock reports

Advanced User Training

Duration: 1 hour

Topics:

1. Complex lock scenarios
2. Regulatory and legal holds
3. Exception handling
4. Reporting and analytics
5. Troubleshooting

Compliance Considerations

Regulatory Requirements

Funds Availability (Regulation CC)

• Check holds must comply with Reg CC timelines
• Maximum hold periods apply
• Customer notifications required
• Exception holds must be documented

Legal Holds

• Court orders must be properly documented
• Hold amounts must match court specifications
• Release requires proper authorization
• Audit trail must be maintained

Anti-Money Laundering (AML)

• Suspicious activity may warrant holds
• SAR filings may reference locked funds
• Compliance approval required for AML holds

Customer Communication

Required Notifications:

• Check hold notices
• Legal hold confirmations
• Hold release notifications

Best Practices:

• Inform customers of holds promptly
• Explain hold reasons clearly
• Provide expected release dates
• Offer customer service contact

Integration Points

Upstream Systems

• Card Processing: Authorization holds
• Check Processing: Check holds
• Loan Origination: Collateral holds
• Compliance: Regulatory holds

Downstream Systems

• Core Banking: Balance updates
• Reporting: Lock analytics
• Customer Portal: Balance display
• Mobile Banking: Available balance

Image placeholder: Integration architecture diagram

Frequently Asked Questions

General Questions

Q: What's the difference between a lock and a debit?

A: A lock reserves funds but doesn't remove them from the account. The actual balance stays the same, but available balance decreases. A debit actually removes money from both actual and available balance.

Q: How many locks can be on one account?

A: There's no system limit. However, the total locked amount cannot exceed the account balance (unless overdraft is enabled).

Q: Can locks expire automatically?

A: Not automatically. Locks must be manually released or seized. However, reports can identify aging locks for review.

Q: Can a customer see locks on their account?

A: Yes, if customer-facing systems are configured to display them. Customers see their available balance, which reflects active locks.

Technical Questions

Q: What happens if the account balance falls below the locked amount?

A: The lock remains in place. The account will have a negative available balance. New transactions may be declined depending on overdraft settings.

Q: Can I modify an existing lock?

A: No. Locks cannot be modified. You must release the existing lock and create a new one with the corrected amount.

Q: What's the maximum lock duration?

A: There's no system-enforced maximum. However, operational policies should define aging thresholds and review procedures.

Demo Script

15-Minute Product Demo

Introduction (2 minutes)

"Today I'll demonstrate BankLingo's Amount Lock feature, which enables banks to place holds on customer funds for various business purposes including card authorizations, check holds, and regulatory requirements."

Scenario Setup (1 minute)

"We'll walk through a realistic scenario: A customer uses their debit card at a restaurant, and the establishment places an authorization hold."

Demonstration (10 minutes)

Step 1: Navigate to lock function

"From the Deposits menu, I select 'Lock Amount' and enter the customer's account number..."

Step 2: Enter lock details

"The authorization is for $150. I'll use the reference 'CARD-AUTH-20241217-001' and note this is a restaurant authorization..."

Step 3: Review and confirm

"Before submitting, notice the available balance will decrease from $5,000 to $4,850, while the actual balance remains $5,000..."

Step 4: View result

"The lock is now active. The customer can see their available balance is $4,850, preventing overdrafts..."

Step 5: Demonstrate release

"Later, when the restaurant settles for $125, we seize that amount and release the $25 difference..."

Q&A (2 minutes)

"I'm happy to answer any questions about the Amount Lock feature."

Summary

The Lock Deposit Amount feature provides banks with a powerful tool for funds management, enabling:

• Risk mitigation through authorization holds
• Regulatory compliance with hold requirements
• Operational efficiency through automated processes
• Customer protection preventing overdrafts
• Comprehensive audit trails for compliance and reporting

By properly utilizing this feature, banks can streamline operations while maintaining strong risk management practices.

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For More Information:

• Developer API Documentation
• Release Lock Feature
• Seize Lock Feature
• Query Locks Feature

Last Updated: December 17, 2025

Document Version: 1.0.0