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

What Is a Business Day?

A business day is a popular unit of time measure that typically refers to any day in which normal business operations are conducted. In Western countries, this is generally considered to be Monday through Friday from 9 a.m. to 5 p.m. local time and excludes weekends and public holidays. Within the securities industry, any day the financial markets are open for trading is considered to be a business day.

Fast Fact

As a rule of thumb, in the U.S., there are generally considered to be 252 trading days in a year.

Understanding Business Days

Consumers often encounter the issue of a business day when depositing a check that needs to clear. Depending on the size of the check being deposited and the location of the issuer it can take between two or more business days for a check to clear, and those days do not include weekends or observed public holidays, which can extend the time that a depositor needs to wait to access those funds.

When conducting international transactions, individuals and companies should be aware that business days may vary by country due to a difference in the public holidays observed.

Key Takeaways

• A business day refers to the typical hours in a day when normal business operations take place.
• A business day is normally Monday through Friday, from 9 a.m. to 5 p.m., excluding holidays.
• Consumers often encounter business days with regard to settling or clearing financial transactions or for the delivery of goods or services.
• When conducting international transactions, keep in mind that the workweek may be different in the country with which you are doing business.

Though most countries work around 40 hours per week from Monday to Friday, there is enough variance out there that those doing international business should verify the days of the business week in the country with which you’re doing business. For example, when doing business with Middle Eastern countries, keep in mind that many of them employ a Sunday through Thursday workweek. In some countries, like India, Mexico, and Columbia, the workweek is Monday through Saturday.

Business days are also used commonly in conveying when something will be delivered or taken care of. For instance, a piece of mail may be guaranteed to be delivered within three business days. This can make a huge difference, as a four-business-day delivery guaranteed package may not arrive until seven days after it is sent if a weekend is involved.

Special Considerations

Other common business day considerations arise when multinational entities engage in international transactions, which typically require additional business days to settle, relative to routine domestic transactions, especially if countries have different workdays.

Various financial contracts and instruments also have an array of different settlement time periods, some ranging from a single day or T+1 in financial parlance to other lengths requiring three business days. Market sophistication and liquidity often determine transaction settlement time periods.

In many ways, improvements in communication channels and capabilities have blurred the traditional business day convention, as businesses and individuals can now conduct business nearly 24/7 using electronic methods.