Put as simply as possible, 'withdrawable funds' is the amount of money we will allow you withdraw out of your EasyEquities account into your bank account or use to purchase a gift voucher.
Where for example, your EasyEquities account indicates that you have R500 worth of 'withdrawable funds', it means that you have R500 in your account that is not subject to any of the lock-ups we sometimes need to apply to client funds. These lock-ups include:
1. Unsettled funds - when you sell a holding on the platform, it takes 5 working / business days for the funds to be settled. Until those 5 days have elapsed you cannot withdraw them. Using our early settlement will shorten the settlement period to 1 day.
2. Debit order funds - when you contribute funds to your EasyEquities account by way of debit order, we lock-up up those funds for a period of 40 days from the date of receiving those funds. This measure is taken to protect us from situations where clients could withdraw the funds and then cancel the debit order within the 40 day period allowed by the Ombudsman for banking services. This protective measure is standard in the industry. For further information see clause 13.6 of the EasyEquities Terms & Conditions.
3. 14 day rule - If you transfer funds into your EasyEquities account by EFT or branch deposit, unless the value of the funds deposited is covered by your holdings / NAV on the platform (as explained below), we will not allow you to withdraw the funds from the platform. This is also a protective measure against potential fraudsters being able to reverse certain types of transactions and having the funds pulled from our account after making a withdrawal, which would leave us out of pocket.
4. Promotional Voucher funds - EasyEquities run promotional campaigns from time to time where marketing vouchers are given to clients / prospective clients. As these vouchers are given as incentives to invest on the platform and not as value to be immediately withdrawn as cash, we lock-up value related to promotional vouchers for a period of 3 years. This is lock-up does NOT apply to gift vouchers purchased on the platform for family and friends.
These rules regarding withdrawable funds are contained in our EasyEquities Terms & Conditions.
It is important to note that some of these protections are put in place to protect the health and longevity of the business and as importantly with that, our clients and their holdings. If we allow ourselves to be defrauded due to sub-par business practices, the effects on you the user could require unnecessary changes like increased costs, less variety of choice / functionality and an altogether less Easy experience.
Sufficient holdings / NAV to cover my withdrawal
This is best explained by way of example:
An Investor has a EasyEquities portfolio worth R15,000 and no available cash. In order to buy a gift voucher of R1,000, she needs withdrawable funds to do so.
She does an EFT into her EasyEquities ZAR account for R1,000 on a Tuesday and the funds are allocated to her account.
In order to determine whether the R1,000 is 'withdrawable' (and can therefore be used for the gift voucher purchase) our system looks at her holdings and determines that she has R15,000 of holdings / NAV, which is more than sufficient to cover the R1,000 she wishes to use.
The system marks the R1,000 as 'withdrawable' and the client buys the voucher and sends it to her very happy nephew for his birthday.
Two days later (Thursday) the client needs to withdraw the R15,000, so she sells her entire holdings and uses early settlement to settle the funds a day later (Friday).
The system however, would only mark R14,000 of the R15,000 as 'withdrawable funds', and it would continue to hold the R1,000 as protection until 14 days from the date her original R1,000 was allocated, have elapsed.
In this example, the client is able to withdraw her R14,000 of 'withdrawable' funds on the Friday, but would need to wait a further 11 days until the remaining R1,000 is unlocked and becomes 'withdrawable' at which point she can withdraw it to her bank account.
Credit card and debit card funds clear immediately
If you are concerned about being able to withdraw funds out of your EasyEquities ZAR account shortly after making a deposit, you can utilise our credit card funding option on the platform as credit card and debit card funds clear immediately and are not subject to the 14 day rule.
If you are unfamiliar with this as an option, we have explained it in our Fund deposit by credit card FAQ article.
Please note, funding an account by credit card and/or debit card, does attract a fixed charge of R1.60 for the transaction, PLUS 2.3% of the rand value of the transaction.