/ Money

Are you ready to wave goodbye to the cheque guarantee card?

Woman writing cheque

This June sees the closure of the 42 year-old cheque guarantee scheme. Is this the banking industry’s way of weaning us off cheques in advance of their attempt to do away with cheques altogether?

I’ve been trying to remember when I last wrote a cheque and was asked for my cheque guarantee card, but I honestly can’t recall.

Since the main supermarkets and other big retailers stopped taking cheques, the main reason I dust off my chequebook is to pay for school lunches and trips, the cattery for my cat’s super-expensive holidays and the occasional tradesperson. And none of these ever asks me for my cheque guarantee card.

The dangers of dumping the guarantee card

So, sorry, cheque guarantee scheme – I don’t think I’ll miss you. But the danger, it seems to me, is that the withdrawal of the scheme will lead to even fewer retailers accepting cheques. And before we know it the banking industry will be using the further decline in cheque usage as a way of supporting their idea that cheques should be abolished.

When we asked the question ‘do you want to save the cheque?’ back in November, this was the issue of most concern in terms of the cheque guarantee card being phased out:

‘Since the cheque guarantee card will no longer be valid after the middle of the year we have to take the risk of bouncing cheques – what solution? Keep cheques as they are now,’ said C Steel.

Danny held a similar view:

‘Even this initial step [of abolishing the cheque guarantee card] is going to hit small businesses etc hard – no doubt we can expect more ‘bounced’ payments.’

Another nail in the coffin for cheques?

Although I’m ambivalent about the cheque guarantee scheme, I’m worried that its closure is another nail in the coffin for cheques. I’m not ready to see cheques disappear just yet, not until there are other good alternatives in place which are truly accessible to all.

Will you miss the cheque guarantee scheme or will you hardly notice that it’s gone?


I agree – It is about time the banks started to listen to their customers – What we need is a proper “Listening” bank – not where the only time they listen is when they agree beforehand.

Now if a Bank decides to continue to have a Cheque system backed up by the Cheque Guarantee Card – we should transfer our accounts to them – Another reason for a “People’s” Bank. What about the Post Office?

100% agree with Richard.

We used to have a “people’s bank” of course: it was called the Trustee’s Savings Bank, but Thatcher sold it off even though it was owned by the account holders not by the state, so that was state theft leaving us where we are now with all banks owned and run for the benefit of the shareholders (in some cases the major shareholders now being the State).

However, longing for such days to return won’t help us in the immediate future with Cheque Guarantee cards. I agree that traders and individuals rarely ask for the guarantee card these days but there are two department stores in Sheffield who still welcome cheques (one of them even making the point in their advertising that Cheques are cheaper for them so they’d prefer payment that way than Debit or Credit card) and both shops ask for the guarantee card. I also make a point of offering the card to the newsagent and any tradesmen whom I am paying. Several accept it and know what to do with it and make use of it, but none ever ask for it if I don’t offer first.

I have heard tell, from a retailer (Jack and Jones clothing), that the banks don’t honour the guarantee scheme any more, citing an endless list of get-out clauses, and that is why J&J stopped taking cheques. I have no idea how accurate this is but I do recall years ago Barclays bouncing a cheque to my mother from me because I would have been 9 pence overdrawn if they had honoured it. When I pointed out that the cheque had the guarantee details on it they tried to tell me I had written them on myself and thus voided the guarantee scheme. This was obviously a stock response without checking first because they were rather embarrassed when I made them send me a copy of the cheque and they sam that the cheque had been typed (in a good old fashioned typewriter) and that the guarantee details were also typed on the back. They did honour the cheque then but I wonder how many times banks use the same or similar stock excuse and never get challenged?

Edward says:
8 May 2011

This means that when I pay the builder, a one man band, it will have to be in cash and perhaps, quite a large amount.
Doesn’t seem to make much sense.

Janine says:
8 May 2011

My only concern when paying workmen such as builders by cash is that they are unlikely to declare this to the tax man. At least if you pay by cheque this has to go through their business accounts.

I am very surprised if cheques cost the same a debit card fee for a retailer. Credit cards are a percentage of the transaction price and a debit card is the processing cost. However as banks charge different rates to different retailers for cheques …. who knows.

I do object to the removal of the cheque guarantee system as yes it does weaken the system. If the banks could demonstrate, in the event of a wide loss of confidence following card cloning, how the countries economy would run I would be impressed, and prepared to consider a new method.

As it stands no bank has any interest in running a fail-safe system as it costs, the Government / Departments also seem not to appreciate how relying on a single card based electronic system is highly dangerous. As for the cloning of cards, or intercepting communications, or cracking large card databases none of it is impossible. I do follow the specialist press on these matters.

In the event of a major failure who do you think will be left running around suffering inconvenience on a massive scale. – hint not the bank chiefs. So show us a system and there may be an alternative but at the moment I doubt that even resorting to cash would work as the ATM;s rely on cards. And I suspect branches hold relatively little cash and the idea of counter cheques is probably long buried.

It is a potential economic catastrophe waiting to happen.

pickle says:
8 May 2011

Dieselay hits the nail on the head!
There are quite a few older persons who will not use cards – whether debit or credit. I don’t blame them, when you hear of all the theft from card accounts in so many ways, it is frightening.
Cheques are simple to use and relatively safe. Blow the banks – it is our money we are talking about and we want to manage it our way….

Not too sure about recent comments – Cheques have been easy enough to forge if the individual cheques are available – marginally easier with a cash counter cheque. The credit card and debit cards do have a bank money back guarantee if you purchase an item over £100. They also have a guarantee against internet fraud (theft).

But it is certainly true that some elderly people refuse to use cards or internet – and a cheque is the only safe way of transferring money if the recipient has no credit card machine

I can’t say I’ve had to use My cheque guarantee card & Sadly that limit now means nothing 🙁 :/

But I have used a fairly few cheques to buy stuff like: The Cinema Exhibitors’ Association Card for disabled people/person taking them to the cinema, & Other people/services 🙁 :/

We should replace cheques with digital cheques,Where thoese who can use computers pay for things online/own bank account, & Those who are less able to use computers,etc, They could get paper cheques from post office or banks/bulding socities, Where they could digitally make cheques or print on them.

Cheques are necessary for those individuals who,for a variety of reasons, are not in a position to use cards or computers.
Peace of mind is vital when dealing with financial matters and why should cheques be abolished to suit the banks?

It appears that this facility is being removed by the Banks in order to reduce their costs and liability they have regarding cheques! Surely it is incumbent on the Banks to provide the services and facilities that their Customers – who after all are paying their wages – with a service that they want. A bit of a situation in which the tail is wagging the dog.

The big Banks have had it their way for far too long, and got away with wavering the rules because no one has got up and called them to book. Now that Which? Have done so they are beginning to squeal. I watch with interest!

Geoff says:
11 May 2011

Yet another example of the Banks putting their own profits first and our “Customer Needs” way down the list…
There are still many small organisations for whom cheques are the preferred method of payment, and I’m sure that in the future there will be ever more elderly people [like my 99 year old aunt] who can read, check and sign a cheque prepared for her by others, but who for various reasons find it difficult or impossible to use the phone or the internet.
I cannot help but feel that too many marketing initiatives these days are dreamt up by bright, young managers who not only have little or no exposure to, or concept of, the needs of those in different circumstances to their own, such as the poor, the elderly, the disabled, or any of the many categories of disadvantaged people in our so called affluent society, but who are also financially incentivised by their share owning boards of Directors to take whatever steps will maximise short term profitability for their employers.
I for one shall weep no tears when they too become unemployed, sick, disabled, old or otherwise disadvantaged and find out the hard way that their needs are not considered important by their successors…

Quentin says:
11 May 2011

Discontinuing cheques is a daft idea, and stopping the guarantee sytem is a nasty way of achieving it. The bankers’ regulators should step in and show some common sense.

Mrs Daphne Hanson says:
11 May 2011

I would not like to see the demise of cheques. I use them regulary for local payments and bills. Sometimes it would be difficult to pay a local businessman unless by cheque or cash, and cash is not always convenient if you do not live near a bank. I think they should continue for at least another five years when no doubt there will be another method of paying local businesses.

Michael Sheasby says:
11 May 2011

Cheques should not be discontinued until all adults in the UK are online and capable of operating internet banking.

Eric says:
11 May 2011

I use cheques for giving gifts to relations or friends at Christmas and for birthdays and donations to charities. What if anything will replace the cheque?.

“Cheques should not be discontinued until all adults in the UK are online and capable of operating internet banking.”

So thats never then : )

I agree with you. In the same way printed books will not be replaced by e-readers there are some things electronics cannot do. Even if/when near field cash cards arrive it still will not replace cheques or cash. There is also the concept of using mobile phones for payments however all of these ideas see electronics as THE answer to everything – which they are not. And security of payment and of your balances will be beyond every customers control.

How’s about a Which? poll on who wants to keep cheques, and maybe a guarantee scheme? I’d agree that the banks aren’t thinking of their customers’ best interests, and there are plenty of other examples of that, which even our disconnected government/regulators have had to acknowledge, cf PPI etc. I use cheques as often as possible, reduces the risk of electronic identity theft. I use direct debits as little as possible, reduces the risk of having to argue with a bank call centre about an incorrect payment, even if I get ripped off by utilities charging me extra – that’s a fixed cost and by avoiding call centres, avoids my having to talk to people who won’t listen. And mobile phone wave-by payments of “small” amounts? You must be joking…

You’ll be pleased to know that we did actually have a poll on whether we should keep cheques, which you’ll be doubly pleased to hear had 92% of voters saying that they didn’t want to see cheques go: https://conversation.which.co.uk/money/do-you-want-to-save-the-cheque/

Will convenience help destroy the cheque?

Even more electronic systems with Visa and partners looking forward to profits on every transaction made. And what will be the redundancy back-up to the system? How long has the Sony system been compromised and then off-line.? OK so Sony is not a bank and I am absolutely sure bank security will never ever be cracked or their systems suffer catastrophic interference.

But perhaps the financial regulators will let us know that this aspect of the economy is being looked at.

Graham pugh says:
11 May 2011

As treasurer of a village hall run as a small charity, and used by numerous other small charities and voluntary organisations, all of whom operate on the principle of 2 signatures on cheques as the main guarantee of probity both for the committeee member and the organisation, cheques are essential for receipts and payments. Internet banking is totally impractical for these situations.
Loss of cheques could quite conceivably see the demise of many charitable and social activities , especially in rural areas where so much is done by local volunteers.

Shirley says:
11 May 2011

I use cheques for sending gifts on special occasions so its important to me that we continue with this form of payment and yes been a long time since paying for goods this way.. Don`t want to see it disappear.

I issue cheques for various activities of the numerous societies I subscribe to and it is very convinient and safe way of making payments. I would be very sorry if it is discontinued.