Can You Still Be Charged the Funding Fee If You Close Before Settlement?

The conclusion is clear: as long as you fully close your position before the funding rate settlement timestamp, you will not be charged that funding fee. The funding rate is only applied to traders who still hold a position at the exact moment of settlement. Closing your position means you have exited that funding cycle.

Step 1: Confirm the funding rate settlement time on your platform

What to do: Find the funding rate countdown for your current contract on the trading interface.

How to do it: On most major platforms (Binance, Bybit, OKX, BingX, MEXC, etc.), the funding rate is settled by default every 8 hours at 00:00, 08:00, and 16:00 (UTC). A small number of USDⓈ-M contracts or special cases may adjust the interval to 4 hours, 2 hours, or even 1 hour.

• On the trading page you can usually see a display like "Funding Rate / Countdown: 0.01% / 06:19:11". This countdown tells you exactly how long until the next settlement.
• If you cannot find it, go to the contract specifications page on your platform and search for "Funding Rate" or "Funding Fee".

How you know this step is done: You know the exact time (down to the minute) of the next settlement for your current contract.

Step 2: Make sure your closing time is before the settlement time

What to do: Determine the relationship between when you plan to close the position and the settlement time.

How to do it:

• Scenario A – Closing time < Settlement time: As long as your closing operation is completed before the settlement timestamp, the system will not charge or pay you this funding fee. Bybit officially states: if a position is fully closed before the funding fee exchange, the trader will not pay or receive funding fees.
• Scenario B – Closing time ≈ Settlement time (within ±5 seconds): You need to be very careful. Because funding fee settlement takes some time (usually a few seconds to a minute), opening or closing a position within 5 seconds before or after the settlement time does not guarantee whether that position will be included in the current settlement. BingX gives an example: A opens a position at 15:59:59 and closes it at 16:00:01, while settlement is completed at 16:00:03 – as a result, that position was not charged the fee.

How you know this step is done: Your chosen closing time has at least a 5-second safety margin before the settlement time, or you are proactively closing well ahead rather than chasing the exact timestamp.

Key reminder: Trying to snipe the exact settlement moment to avoid the funding fee carries risks. System settlement has delays, and you cannot precisely predict whether settlement has already started. A safer approach is to close at least 5–10 minutes early, rather than cutting it to the last second.

Step 3: Confirm whether the funding rate is positive or negative, and your position direction

What to do: If you still hold the position at settlement time, know whether you will be the payer or the receiver.

How to do it: The funding rate is determined by market supply and demand. When the funding rate is positive, longs pay shorts; when the funding rate is negative, shorts pay longs.

• You can check the current rate and predicted rate in the "Funding Rate" area of the trading page.
• If your goal is to avoid an expense, glance at the rate direction before closing. If your position happens to be the receiver (e.g., you hold a long when the rate is negative), it might be more profitable to stay and collect the fee rather than rush to close.

How you know this step is done: You know whether you would pay or receive the fee if you kept the position through settlement.

Step 4: Execute the close and verify the fee record

What to do: Place the closing order, then check your trade history to confirm whether the funding fee was deducted for that cycle.

How to do it:

• Complete the closing operation (market or limit order) before the settlement time.
• After closing, go to "Order History" or "Transaction History / Account Statement" and look for the funding fee record for that settlement period.
• If you see the record showing "0" or cannot find any funding fee entry for that period at all, it means closing successfully avoided the charge.

How you know this step is done: Your history does not show any funding fee deducted for your position during that settlement cycle.

Prerequisites

Before doing this, make sure you actually hold a perpetual contract position that you need to close, and that you have already understood the contract's funding rate and settlement schedule. If you have no position, the funding fee does not apply to you.

Common reasons for failure

Many people think, "I just need to close one second before settlement." But the platform mechanism is not instantaneous – the settlement process can take several seconds to a minute. You might close at the settlement timestamp, but the settlement cycle may have already started and your position may have already been counted in that period's fee calculation. Even more often, users trying to snipe the exact second encounter network latency or their order fails to fill, resulting in the position not being closed and the fee being charged.

Risk warnings

• Capital risk: If you close your position early just to avoid a small funding fee, you might miss subsequent market moves. The funding fee is typically only 0.01%–0.3% of the position value, far less than the profit or loss from price fluctuations. Do not lose the bigger picture just to save a small amount.
• Account risk: If you frequently close positions just before settlement and then reopen them, you will generate additional trading fees. The taker fee for a single open-and-close round trip (around 0.05%) may be higher than the funding fee itself.
• Compliance risk: None.

How to confirm you've done it correctly: After closing, check the fee record for that funding cycle in your account statement and verify it shows "0" or the record simply does not exist. Next step: If you closed to avoid a positive funding rate and you still hold the same directional view, you can reopen the position after settlement – but note that reopening incurs another trading fee. Calculate carefully whether the "trading fee expense" or the "funding fee expense" is cheaper before making your decision.