float is money in the banking system that is double-counted, once in the payer's account and once in the recipient's account, when there are check-processing delays. this double-counting usually lasts for just one to two days until the check clears. here is an example of how float happens. ? lives in new york and uses a credit union there for her banking needs. she travels to san francisco for vacation and writes a $500 check to pay the owners of the ? where she ?. the b and b owners deposit ?'s check in their san francisco bank. the san francisco bank then sends the check to the nearest federal reserve bank also in san francisco for processing. the san francisco fed collects the money from ?'s credit union in new york and $500 appears in the b and b owners' account after a standard two day processing period. if it takes longer than the usual two days for ?'s check to travel from the san francisco fed to new york, the money might still appear in the ?'s account and there will be a positive float of $500 in the banking system. but, if the check makes its journey in just one day, float will be negative, because the $500 will be debited from ?'s account but not yet credited to the b and b owners' account. any time there is an event that delays check transpotation like a severe storm, float increases. increased volume of check writing around common pay days and the winter holidays can also cause processing delays and increased float. but, since fewer checks are transported physically today than in the past thanks to increasing numbers of electronic payments, the problem of float is smaller now than in the past.