Another step towards getting rid of cheques

A while ago the banks announced that they wanted to phase out cheques in 2018. What is less well known is that we won't be able to use banks cards to guarantee cheques after the end of June this year.

Cheques are still widely used by older people, small tradesmen by local organisations that require clear financial controls – clubs, small charities and local councils. As recently as 2008, cheques were used six times more frequently than online payments.

The proposed phasing out of cheques in 2018 is squarely based on the costs to the banks, not on any consideration of customers’ needs. Stopping the cheque guarantee card facility in 2011 appears to be a deliberate move to make cheques less attractive to use by transferring risk from banks to customers, so accelerating the decline of cheque use.

The obvious paper-based alternative to a cheque is the postal order. However these are very costly – from £10 upwards the fee is 10% of face value, capped at £10, and they are only available up to a value of £250. They are also much more inconvenient to use because they require a visit to the post office (another facility that is in decline) to purchase them.

Even if the banks do not suggest postal orders as a viable alternative, there must be a concern that that postal orders will set the benchmark for the fees banks would levy for their own alternative.
We're campaigning against a change that is principally for the benefit of the banks, and works against the interests of millions of people and the community organisations they support.