While using the Blnk Ledger, you might encounter negative balances. A negative balance simply indicates that the ledger has more debits than credits. This indicator allows you to quickly assess the financial position of a ledger balance at a glance while reviewing your data.
balance = credit_balance - debit_balance
Balance IDbalancedebit_balancecredit_balance
bal_abc123-200004500065000
bal_def456100002000030000
In the table above, the balance for bal_abc123 is -20000, indicating that debits exceed credits, resulting in a negative balance. On the other hand, bal_def456 has a positive balance of 10000 because credits exceed debits.

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How to avoid negative balances

Negative balances are not a cause for alarm. However, if you prefer to avoid negative balances in your ledger, here’s how you can adjust your setup.
1

Designate a funding pool balance in your General Ledger.

Use a designated funding pool balance to pre-fund your ledger balances with starting balances. This approach ensures you can post transactions on those balances without triggering overdrafts.
2

Apply overdrafts when funding from the funding pool balance.

This ensures that only the funding pool balance incurs a negative balance, while your customer balances and other critical balances remain unaffected.
{
  "amount": 120000.23,
  "precision": 100,
  "reference": "ref_123abc",
  "source": "@FundingPool",
  "destination": "bal_customer",
  "description": "Creating a starting balance",
  "apply_overdraft": true
}
Always ensure this implementation aligns with your money movement map. Depending on the flow of funds within your system, not all balances may need to be pre-funded.This decision should be guided by the specific requirements of your financial system.

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Need help?

We are very happy to help you make the most of Blnk, regardless of whether it is your first time or you are switching from another tool. To ask questions or discuss issues, please contact us or join our Discord community.