/ Money

Result! Together we saved the cheque

People crossing the finishing line

Start spreading the news, the cheque has been saved! The Payments Council announced yesterday that cheques will continue in circulation for as long as consumers need them – and the victory is largely down to you.

This is fantastic news for consumers and ensures that the millions of consumers who use cheques are not left out in the cold.

I’ve written several times about cheques on this site and the response I’ve received every time has been overwhelming; you want to save the cheque. You’ve posted over 300 comments, helping us to identify the numerous reasons why the cheque should be saved and the countless situations in which the cheque is the most suitable method of payment.

Payments Council sees sense

We’ve taken your comments to Parliament, the Payments Council and the industry and now it seems they have finally seen sense.

The decision came after a surge of public support for the retention of the cheque. As members of the public voiced their concerns, more and more parliamentarians and banks started to sit up and listen. Speaking yesterday, Richard North, the Chairman of the Payments Council said:

‘It’s in the DNA of the Payments Council to consult and listen to all those people who actually make payments and use cheques. Listening to over 600 stakeholder groups, working with the banks and following our appearance before the Treasury Select Committee, we have concluded we should reassure customers that the cheque is staying.’

Bowing to public pressure

The Payments Council’s appearance in front of the Treasury Select Committee may be regarded as the turning point in this saga. If you haven’t watched the session I would recommend it. At times the questioning is brutal. However, this point was only reached because of the public pressure that has built up over recent months.

People made their feelings clear to their MP, to the Payments Council themselves and to organisations such as Which?. In the end the groundswell of public support for the cheque made the Payments Council finally see sense. Now this ruling has been made banks need to make sure they listen to what their customers want and stop any attempts to discourage people from using cheques.

I normally write on this site to ask a question or to find out more about an issue. Today I am writing to give you all a pat on the back. People power has won out.


At last – some common sense. A tribute to all the people whose views are so often ignored in the name of ‘progress’, but who spoke loud and clear about how abolishing cheques was a mistake. And a sigh of relief for charities, schools and many other small organisations who rely on this form of payment.

This is fabulous news. I am a Guide Leader and receive the termly subs by cheque. I also did not feel comfortable about the thought of sending my daughter to school with large amounts of money for school trips. Excellent People Power!

Battle ONE won – now for battle TWO – the return of Cheque Guarantee cards.

Absolutely Ricky – I was about to post the exact same thought but you got there first.

Since the Payments Council went ahead and stopped the guarantee scheme on June 30th (a few days after their appearance before the select committee at which Richard North was made to look a thorough fool – and for all I know he probably is – and at which time they COULD have u-turned if they had wished) a vast number more shops have stopped taking cheques, which undoubtedly was the motivation for stopping the guarantee scheme.

Now they have been forced to admit cheques are needed how about giving retailers and issuers the confidence back that cheques are also still reliable.

Come on Which?, select Committee and Payments Council; get to work!

I am so pleased that common sense has prevailed. Customers should be the people deciding if they want to use cheques, not Banks trying their big brother tactics. I can remember when the bank manager knew all his customers and greeted them by name, and asked if he could help when you entered his bank. Now perhaps we could return to banks looking after their customers instead of trying to dictate what they should and should not do!

Stuart says:
13 July 2011

Oh well done ! Why not campaign to bring back £SD and scrap decimalisation while you’re at it ! It’s a pointless ‘victory ‘. The banks are scrapping cheque guarantee cards, so no one will accept cheque payment anyway.

There are thousands of organisations who already accept cheques without guarantee cards – schools, Guiding and Scout Associations, school dinner companies, PTAs, not to mention charities.

well said Kate C – I would have thought that the very few, short sighted, selfish and rather foolish people who don’t like cheques would have had enough and gone away to play with the traffic by now after the trouncing they got on the earlier boards on this subject.

I do believe we are supposed to live in an age of “Equality”, “Diversity” and “CONSUMER CHOICE”, so let’s have those things applied to payment methods as well as to what the law enforces eh?

Stuart: Sorry if this does not suit you but the reasons for keeping cheques have been made clear on this site. I would also like to see the return of the cheque guarantee card, but to cover a larger amount than £50. As before, it could be combined with a debit card.

I’m only going to use cheques when there is no practical or secure alternative.

Good news – I shall continue to use the cheques for my various societies activities and paying my dentist!!!

That is such great news. I can continue to send cheques to my nephew and nieces. Wonderful. Common sense has prevailed for once.

Thank God the cheque is saved. Without them my mail order business selling components to railway modellers would fold as all my customers send cheques with their orders. What we need now is for the cheque guarantee card to be replaced for when I take my stand to model railway exhibitions.
Hundreds of mail order companies would cease to exist without cheques.

David D says:
11 November 2011

Great that the cheque is saved, but some financial institutions seem to be making life harder when paying them in. I do voluntary work for a small charity and our elderly residents do not always write their cheques out accurately at the first attempt and I have to get them to correct details and initial the changes. Unfortunately, this is no longer good enough for the Nationwide who have informed me:

“If the cheque is drawn on a Nationwide account and the alteration has been initialed by the account holder we will accept it. If the cheque is drawn on another financial provider’s account, you will have to confirm with them if they are still happy to accept altered cheques and whether they have any special requirements if a cheque has been altered, initialed on front, double signature or confirmation on reverse. [how practical is this?]

The Bank of England are now leaving it to the individual banks whether to accept altered cheques or not.”

The Nationwide and BoE are obviously not trying to help either individual customers, charities or the ‘Big Society’ . Mmm!

Harry says:
16 March 2012

Cheques are a convenient mechanism for payment to friends, relatives, clubs and societies where there is already a measure of trust between the parties concerned and the parties are present and from that standpoint it is good that they continue.

However, its annoying that there are still businesses that are so firmly entrenched in the nineteenth century that they will not accept payment by any means other than cheque.

I give as an example the company that I have to pay my ground rent. Yes, its a business not a private individual. The payment is exactly the same every year (for the next 15 years anyway) so standing order is the obvious and effortless way to pay it. But no, the company insists on me waiting until it has sent a demand, which I then have to remember needs paying. Then I have to find my chequebook (which I rarely use for any other purpose), write and post it together with a remittance advice, write an address on an envelope (no, they don’t even provide a return envelope), buy a stamp and finally post it. So, that has wasted the cost of two stamps and destroyed another little bit of a tree, all for absolutely no reason.

Cheques need to continue for other non-business transactions, but its high time that *businesses* however small or large were required by law to accept payment by bank transfer — which with most business banks costs less than processing cheques anyway.

I have no objection to people using cheques-provided they pay for the privilege. I estimate £1 per cheque is the cost to the bank including a small surplus.
Of course the banks costs are only part of the equation. The provider has to write a cheque and get it signed ( a nightmare in business- he’s at lunch/in a meeting etc). There are postal costs, about £1 including the stamp and envelope. Then there are the time costs because some poor clerk had to take the cheque to the bank.
Then there are the security costs. Cheques get lost, banks do not check the signature (trust me, it is the norm).
Cheques are much easier to forge than electronic payments
So in addition to the costs to the bank there are the costs to the payer and the payee.
Hard to estimate those, it needs a room of accountants to work it out. Accountancy is an art not a science.
So let’s say a total cost of paying by cheque is £5.
Everybody who writes a cheque should pay £5 into the ‘I AM A WASTER OF OTHER PEOPLE’S TIME AND ENERGY AND I AM A SELFISH PERSON’ box .
I exaggerate but hope the point is clear.
Anyone who makes a valid objection to my logic will receive a free quill pen.



Please can you read through the comments in the earlier Conversations about cheques. You will find them via the link in the introduction by Chris. They demonstrate the continuing need for cheques and considerable support from many of those who have commented.

Elsewhere you have been pushing for getting rid of cheques on the basis that they are a problem to you. Others need cheques, including charities and some individuals. I am pleased to see that you are now advocating a charge rather than a ban on cheques.

If people have to pay for using cheques they should also pay for all banking services, including the ones that you regard as essential. As I have said in our previous discussion, I avoid cheque transactions if I can but I work for a small charity that is, like many others, dependent on cheques.

We have to consider everyone and not just what suits you or me. And you are accusing anyone who uses a cheque as being selfish. 🙂

Let me make my views clear. Bearing in mind competitive pressure banks, and any organisation, should charge a fee acceptable to the customer base they want and giving them a decent return on the capital employed in a business.
At the moment because of public objection expressed in Which and elsewhere the banks are not charging for cheques.
(As an aside I suspect they are ready to do so, they are just waiting for the moment to pounce.)
None charging for cheques is an issue for banks More important, those customers who do not use cheques are cross subsidising those who do.
I believe that this is wrong ethically. Those using cheque are getting a free ride from those who use electronic banking. In my opinion they are selfish parasites.
As soon as this situation stops the happy I will be.

You make the point that people using cheques are subsidised by those people using electronic banking. But electronic banking does cost banks as well, though a bit less. And businesses are charged to pay in cheques and for debit & credit card transactions. So it not a simple cost equation.

However, how do you pay a tradesman who comes to your house to do work? My TV aerial repair man was not able to accept a card payment and the bill was greater than any cash I had to hand. On top of this people are unwilling to give out their bank account details for fear of conmen raiding their account. Without this information electronic payment is impossible. So what alternative to cheques is there?

There is the issue of making electronic payments that don’t go to the person intended. Then it is impossible to find out who the money went to and being unable to reclaim it due to data protection preventing banks from providing such information.

@John: your use of language such as “parasites’ does nothing at all to advance your cause. You will have some supporters who already agree with you but the way you treat those who do not (yet) agree with you will only alienate them further. Additionally I don’t think it’s within the spirit of the convo guidelines to be using such terms. No matter.

As far as your arguments for charging for services such as cheques go, you are conveniently ignoring the well documented, well publicised and easily available on-costs for processing other transaction types, most notably debit cards. The on costs for ALL types of transaction, including but not limited to cheques and debit cards, are passed on to every single one of us via bank charges and retailers’ mark-ups. Personally I don’t use much real cash these days, but there are many people, and significantly all those people to whom banks won’t give an account with a debit card or cheque book because pf their financial circumstances (people who you, on another board, appeared to suggest the banks should turn their backs on completely) who rely on cash. Often (not always I know but often) these people are forced to use cash only because they are POOR. Why should they have to subsidise the transactions of “parasites” (your word) like YOU (ATM’s, debit cards, online banking), ME (Debit cards, on line banking), Wavechange (Debit cards, on line banking) and anyone who uses a cheque too?

I’m sorry John but your bad temper, aggressive tone and unpleasant language is not going to win you the argument. If you and your supporters win it will be for other reasons than your outbursts on here.

Many months ago, when covo’s like this one on cheques started, a good number of contributors urged others to consider people worse off than themselves: you don’t appear to be doing that and I’d like to ask that you start to do so.

Excellent post Dave D. It would be nice to get back to a Conversation rather than an argument.

Dave D

Completely and Utterly agree with your comments – such poor attitudes reduce the point of “conversations”

Sorry Richard You are talking absolute rubbish.
An electronic payment costs nothing to process. The work is done by electronic machines.
There are controls in place to make it extremely difficult to make a payment the wrong person. Further there is an electronic trail of where every payment has gone.
None of this applies to cheque payments.
As to local cowboy traders, it depends on what you can negotiate.
So you are free to use cheques. But you must pay. I think £5 per cheque would be appropriate.

I assume that you mean the machines that cost nothing to buy, install and maintain. No doubt they are all controlled by free computers run by unpaid staff.

I an not sure it is Richard who is talking absolute rubbish. 🙂

David D says:
25 August 2012

John, please accept that electronic payments have a cost too. How much do banks pay per year on IT departments? How much do companies spend to stop electronic details being hacked? How much do companies spend when customer details have been hacked or leaked? (Ask RBS / Nat West / Ulster for their recent experiences). Both electronic payments and cheques have their place. Society needs both to function.

Wave change. You are right. There is a setup cost to install the computers in the first place. Thereafter the costs are minimal- electricity, help desk etc.
Compared with the cost of processing a cheque the costs of processing a payment electronically are virtually nothing.
When I studied accountancy the principal I described was known as marginal costing. It is a simple principal known by all successful l businessmen but surprisingly hard for many to grasp.
I think this answers David’s point also, for which I thank him

But you still cannot deny the idea that cheques are the preferred method of many – particularly the elderly – quite frankly I do not like the idea of the elderly being punished for using cheques. If we are going that way – let us have a unified “transfer” charge that applied to all money transfers however made.. But then my current account would not be free at the point of use which it is now..

I don’t think your principle is hard to grasp – but I certainly disagree with it.

Additional – The amount of electronic fraud has rocketed to many millions a year – So electronic transfer is not the cheapest or most effective method.

I am elderly and I consider your remarks patronising and objectionable.
Research shows elderly people are far more computer savvy than the so called young.
And if the elderly can write a check and prepare a letter and post it, surely they can work a computer.
Where is your evidence for the statement that the cheque is the preferred method for many? I deny it.
For business, according to banks the cheque has vanished.
Perhaps you are the problem. Perhaps you cannot cope with modern life even though you are young.
I ask you to withdraw your remark. It is offensive.

Sorry I’m 82 and computer literate – I used to teach it. I help to run a couple of charities and Help run an OAPs club – The Charities have large numbers of elderly people who contribute by small cheques – just as has been stated before – they DO NOT have computers many don’t like computers – why should they be penalised because YOU want them to? In the OAP Club a fair number have computers – but by no means the majority – I run computer appreciation courses as well as a “Bugeting” help system for them – BUT their trust is in cheques not electronic transfer – so frankly they should do so because they want to. I cannot withdraw my remarks which 17 years of personal experience show to be true. Which is exactly what this Convo is about.

Additional You are talking rubbish. Where is your evidence for this wild and ill thought statement?
It is sad we started down this road. I blame Which for its irresponsible reporting.
Which was a dynamic forward thinking organisation in the days of Michael Young.
Now it is a creaking edifice unable to face the modern world.
To all my readers, cancel your subscriptions. Then they will change. The need for a consumer champion is still there though your best bet is simply to buy elsewhere.

Hate to be “objectionable” Have you read the papers – The amount of electronic fraud is rocketing and the last figure I read was £200 million country wide.

Hello John, we’re all for moving with the times and going forward with modern technology – you just have to have a read through our Tech blog http://blogs.which.co.uk/technology. We’ve also talked about the importance of getting the elderly online, as rightly or wrongly there are many benefits with deals, special offers, better accounts etc online https://conversation.which.co.uk/technology/are-silver-surfers-put-off-by-complicated-computers/

However, when so many people told us (right here on the internet) that they are not ready to move on from cheques, we took those views to policy makers and the payments council to tell them it wasn’t the right time to phase out cheques. As much as progress is needed, moving too fast can leave many people in society behind. And hopefully politeness isn’t too old hat now either… thanks.

I suppose I must be one of John’s “selfish parasites” but I honestly believe that no one else is subsidising my banking facilities; on the contrary . . .

I had not appreciated that businesses had abandoned the cheque and that it had “vanished”. As just one common example, the managing agents of blocks of flats are getting a constant flow of cheques from the leaseholders for service charges, ground rents, insurances etc. A host of other examples have been given in the previous Convesations around this topic.

I issue quite a number of cheques to businesses, none of which are requesting me to make payments by electronic transfer. In the last few weeks alone I have also received several cheques from businesses and the HMRC and I wouldn’t have wanted the payments in any other ways – on the day I pay each cheque in I can decide which account I wish to credit without then having to do another money transfer [which I would be necessary if I had nominated one account for all remittances]. A huge number of small shareholders receive their dividend payments in cheque or warrant form for payment into a bank account; such payments are also available electronically but many people still elect to receive and pay in a cheque and it might be because they want to pay it into a savings or oher account that they would prefer to keep private.

Surely a significant proportion of the operating costs of electronic funds processing is the amortisation of the initial capital outlay for the computers and terminals, power supplies, accommodation, secure digital connexions, and other infrastructure. I am not convinced that the return required on this investment can be dismissed as negligible.

Let me make my views absolutely clear. Let us agree to disagree if that is all we can do,
I believe people should have the facility to pay by cheque. However, if that is their wish they should pay for it.
If they want it they will pay for it.
End of message.
Remember the saying. There is no free lunch and attempts by a magazine to encourage such behaviour should be condemned outright.
If that is what Which is trying to do, I condemn them without reservation.
I make about 20 payments per month. I have written 2 cheques in the last four years. As it happens the payee lost one and I had to make an electronic payment because he could not cope with cheques.
And by the way I count as ‘old’.

I believe that everybody should have the facility to pay by electronic transfer. But .if that is their wish they should pay for it.
If they want it they will pay for it.

It works both ways. I count as very old.

I respect your position John. I suppose what you are saying is that people that want you to pay by cheque should make it worth your while [including reimbursement of any charges your bank makes for issuing a cheque and then clearing it, plus any postage costs] and that people who want to pay you with a cheque should compensate you for having to pay your bank to accept it [more if you pay it in at a branch] and process it through to clearing. Traditionally, in the overall scheme of things, these transactions reciprocated and it was considered preferable to abolish charges for such essential elements of banking. Now, with such differentials in the costs of the various forms of transaction [cheque, ATM, on-line, CHAPS/BACS, counter service] the relatively high unit cost of cheque processing has been highlighted leading to calls for either discontinuation or for economic charging. I think most people are worried that reintroducing charges for cheques would rapidly lead to discontinuation as the charges would surely approach prohibitive levels as demand fell away. It seems that keeping “free” cheques within the envelope of standard banking services not funded directly according to uptake is – like the universal flat-rate postal service – one of the hallmarks of our current level of civilisation.

I pay bills by credit card by preference. It helps me manage my finances. If there is a charge for using a credit card, I pay by debit card. If there is a charge for using a debit card I pay by cheque. Sometimes there is information about how to pay online, but no-one ever suggests this face-to-face.

Tradesmen often want cheques, the small companies that produce banners, posters, embroidered clothing and various other things (for a charity, if I dare mention this) all want cheques. The local branch of Kall Kwik does not take cards, and prefers me to pay by cheque for copying and producing booklets.

Dividend payments, often for only a pound or two, arrive by cheque, though I do try to ask for future payments to be made to my current account. I’ve just received a rather welcome cheque from HMRC.

I’ve noticed that organisations often make a surcharge for credit card payments, sometimes make a charge for debit card payments, but never make a charge for payment by cheque.