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Payment Date Meaning & Definition

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Definition of Payment Date

Payment date is (1) the day when a dividend will actually be sent to investors. The payment date is set by the corporation’s board of directors, at the time when they initially declare the dividend. (2) the date when the purchaser of a security must deposit the funds to pay for the purchase.

Applying "Payment Date" to Securities Exams:

When the board of directors declares a dividend they must set the day when that dividend will actually be paid to the shareholders of record. This is known as the payment date. (2) When an investor purchases a security they must pay for the securities in line with Regulation T which sets the payment date for most types of securities transactions. The payment date for most securities is two business days after settlement.

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