/ Money

Do you want to save the cheque?

Writing a cheque

It’s official – cheques are going out of fashion and plans are in place to wipe them out completely by 2018. However, one MP is arguing that the elderly still depend on them, so do they still have their place in society?

When was the last time you wrote a cheque? In a shop; to pay a bill; or maybe to pay a tradesman or friend?

For me, it’s most definitely the latter. I can’t remember the last time I took my chequebook shopping (I can already hear the disapproving tuts as I hold up the queue) and I pay all my bills by direct debit. But when it comes to repaying friends or tradesmen, the chequebook still has its place.

This is an argument one of our readers, Malcolm Murray, wrote to us about. ‘If a plumber does a job for you they expect to be paid on completion, but don’t have any facility to deal with payment by card,’ he told us. ‘So unless we keep large sums of money available, a cheque is the only practical method of payment.’

How cheques went out of fashion

The plan is for the Cheque Guarantee Scheme to be phased out completely by mid 2011 and for cheques to be made obsolete by November 2018. The Payments Council, which monitors payments in the UK, says these decisions follow wide consultation and research that shows ‘cheque use is in long-term, terminal decline’.

Strong words, and the Payments Council’s figures do back this up. There were just over 3.5m cheques issued each day in 2009, compared to 11m in the peak year, 1990. I don’t think 3.5m is a figure to be sniffed at, but it is put into perspective when compared to the 30.2m transactions made on UK cards every day in 2009.

The fight to keep cheques alive

But while there’s no denying that chequebooks have been usurped in the popularity stakes, there are still people who rely on them, not least the elderly. This is an argument that’s been getting some press of late, thanks to support from MP David Ward.

He’s been arguing that the 2018 cut-off date is wrong and would be detrimental to older people. He’s not wrong – those under 25 receive on average only two cheques a year, while over-65s get four. And as many elderly people have no access (or understanding) of the internet, cheques can be a safe and easy way for them to pay bills.

But it’s not just the elderly who will miss their paper friend – many of you raised concerns about a cheque-free world when we ran a Conversation back in July. “If the threatened death of the cheque book comes about, how are we expected to pay for things? Wodges of cash? That’s asking to be mugged,” fumed Ann Hay.

Others, like i_steven, were more concerned about how banks will benefit. “The banks will get their own greedy way again and again once they have forced us to pay larger amounts by card,” he said.

For now, the 2018 date remains in place, although the Payments Council has responded to David Ward, saying they’ll only go ahead with the date ‘if we’ve been able to ensure that alternatives have been identified, are accessible and are actually being used’. Is that good enough for you, or do you have concerns about a life free of chequebooks?

Should we get rid of cheques?

No, I still find them useful (92%, 1,229 Votes)

Yes, they're not relevant any more (8%, 109 Votes)

Total Voters: 1,338

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It’s true I’ve not used cheques for ages until this past week. I had my garage door repaired, and had a heat survey on my house; both wanted payment after the work was done. Before cheques are scrapped we need a replacement for these situations.

If cheques are scrapped there will be more cash transactions between traders and their customers, and a higher risk of targeted theft for small traders (for example window cleaners)?

By the way, your survey question does not match the Yes; No answers!

Just to make sure that no-one’s confused by your comment – we promptly changed the options in the poll to make sure they made sense. Please feel free to vote away.

JunoB says:
19 November 2010

Absolutely agree with Jonas 13141. I have recently sent a cheque as a gift to my godson who is at college. The alternatives would be cash or gift tokens, and having had gift tokens stolen when posted for his birthday, I am reluctant to do either of those. I use cheques to pay my window cleaner, my garden helper and other ‘small business’ traders on a quite regular basis. I also use an ATM and bank online.
Why on earth get rid of something just because it is not ‘popular’. I know people who are on good incomes as retired professionals, but who are rated by the registrar general as Social Class 4 because they do not from choice own a car, a tv or a computer. We make too many assumptions and are turning into a nation of unthinking, boring clones.

Terry Stacey says:
19 November 2010

NO cheques SHOULD NOT be phased out as they are still a useful way of paying a bill. The idea is yet another way for the banks to charge us more when using an alternative method of payment.
Incidentally, (forgive me for being rude), but who was the idiot who ‘worded’ the survey question and was it not proof read?.

Absolutely 100% agree with all 3 above – and yes the survey was clearly penned by an idiot who did not proof read!

More seriously though, as a 40-something year old who cannot have an ATM card because although the bank accepts my sight deficiency and gives me a chip& signature card to use in shops, this means that I cannot use an ATM. This leaves me dependent upon being able to go into a bank branch or obtain cash-back in a shop to get hold of cash for payments, which is not much use if you have, for example, an emergency plumbing repair late at night for which you have to pay, as others have said, on completion and without planning for it.

The numb-nuts in teh financial industry who have come up with this money spinning (for them) scheme want us to believe that one size (i.e. a card that gets cash at an ATM and which pays in shops) fits all, but it blatantly does not for all the reasons given by the 1st three posters and me.

Taking such serious concerns to one side for a moment, there is also the question of when exactly the customer ceased to be right? The customer should have the choice and flexibility to access and dispense their hard earned money in a way which is most convenient for them. After all, if it was not for us entrusting our money to the banks, the banks would not exist, let alone be able to pay themselves these obscene bonuses, and if our money makes them that much profit then we should have the say in what we get in return in the way of really very basic services.

Personally I cannot quite see how the cheque can ever be completely replaced by any other system – there seem to be far too many places where a cheque is the only safe means to pay.

And, before I get off my soap box, there is one other point: for traders to accept cards they have to PAY the BANK for the privilege of receiving the money from the customer. There are a number of charges ranging from a fee per transaction for “processing” to the cost of hiring those very silly card readers and PIN pads – yes the banks CHARGE the retails to have those, just so they can use the cards that the banks FORCE the customers to have – and of course every time a card is inserted into the reader the machine makes a telephone call – that’s a minimum charge of 5.2 p the last I heard – over a ‘phone line that the RETAILER has to pay to have installed and pay rental on to the telephone company. Lastly there is the (admittedly tiny) cost of electricity to power the terminals. All these things add up and, naturally, they are added to the prices that we pay for goods, so in the end we, as customers, pay AGAIN and small traders who just can’t afford to have these machines or pay the bank fees are left having to accept only cash or ….CHEQUE!

Donald35 says:
19 November 2010

I have just checked (sorry) my account. I have 17 pages of statements, done online, of which only 19 items are cheque payments. However, none of these could conveniently have been paid by an alternative method, so no (or should it be yes) I don’t want to see an end to cheques.

Leslie says:
19 November 2010

When I had a milkman, I seldom saw him so a cheque was left outside the house for him to pick up. I certainly would not leave cash out this way. Transferring money between friends or family is most conveniently done by cheque as is donating to charity. I suspect the banks want to force us to make use of money orders and charge a high fee.

Jennifer says:
19 November 2010

I would have thought HMRC would have preferred cheque payments to small traders instead of cash which they may or may not declare …

and I agree with everyone else about paying windowcleaners, washing machine repairers, and such. Giving a grandchild a cheque for birthdays is much nicer than just transferring a sum to their bank account too.

hilary says:
19 November 2010

What daft comments alongside your yes/no answers to shall we get rid of cheques

Sorry about that Hilary, we’ve now reset the poll with the correct answers and wiped out all previous votes in order to make sure it’s accurate.

If you’ve already voted in the poll, please cast your votes once more. Thanks.

I wholeheartedly endorse that cheques should not become obsolete. Yes, the elderly use them quite regularly and should retain the option to continue to do so.
As the owner of a very small rural business, we have checked the feasibility of acquiring a card reader from the bank. For the amounts of money we are regularly dealing with, the charges levied by the banks are extortionate.
As mentioned by Dave Darwent above, you pay to get the machinbe, a surcharge is made on each transaction – and then if you haven’t reached a base level in a month, you have to pay a top up fee. There is also the problem that if you are in the middle of nowhere, on a showground for instance with no power/signal, you can’t make the machine work! If it is a slow signal, cards are sometimes declined to boot!
The nearest ATM to us is just over 3 miles away and we have already on numerous occasions had to tell customers they will have to drive to it, withdraw cash & then drive back.
If cheques are to be done away with – surely the banks would have to supply all small retailers/businesses with machines FREE OF CHARGE – but I won’t hold my breathe waiting for that to happen!

pickle says:
20 November 2010

Of course cheques should continue to be used. How on earth can you pay someone by post or any other way? Cheques are convenient, do not involve cost to the recipient, do not involve cash and ensures reasonable security.

I’m treasurer of an allotment association, also audit the books of a tennis club & another voluntary organisation. All three bodies receive & make payments in relatively small amounts, for which the cheque is perfect. It’s difficult to see what alternative there would be that would not impose significant costs on the organizations. You can’t send cash by post, & people should be reluctant to send card payment details.

Sophie Gilbert says:
21 November 2010

Let the person who’s never made a wording mistake cast the first stone. I know it won’t be me.

Yes, keep the cheque. This is just another cost cutting exercise, on administration, to the detriment of the customer. If banks want to cut cost, let them not pay indecent bonuses to their staff, especially to those who plainly don’t deserve them.

I am convinced this campaign by the Payments Council [Who?] is nothing but a frightener to drive us all onto the internet; as other conversers have pointed out, there is no alternative to the cheque for millions of everyday situations. The number of cheques issued today might be less than in 1990 but the banks happily managed with far fewer cheques and many more branches when I was first allowed to have a current account [1968]. And in those days they were all manually handled and personally scrutinised [and, even better, there was same-day clearing between accounts at different banks in the same town much to the benefit of small traders and shopkeepers]. I am really looking forward to the day when I can stop using a computer but I am seriously worried that the alternative facilities [including paper bills, invoices, confirmation notifications, etc] will no longer be available except upon payment of a extortionate penalty charge. For security reasons I shall never send my credit card details [with ‘security code’!] through the post or give them on the telephone so when I do mail order I enclose a cheque. In forty years of sending cheques not a single security breach has occurred but the dreadful tales of identity and credit card fraud show that it is a frequent experience with this method. I think the government should nip this crackpot wheeze in the bud before it gathers any more momentum.

I’m 32 years, one month, three weeks and three days old. I have never written a cheque. I don’t think I ever will.

You are also either :
a) very lucky never to have needed to
b) very naive and trusting with carrying larger amounts of cash
c) too trusting for your own good with card details
d) live with someone else who does write cheques for you when needs be or
e) some combination of the above.
Without wishing to sound rude, “Bully for you” springs to mind, but I don’t see why the sight-disabled, the elderly, the rural dwellers and the small traders should suffer hardship, loss and inconvenience just because blessed people like you have managed not to need a cheque yet.
Maybe that wasn’t what you were trying to say but I’m afraid it comes over that way.

I use my cheque at least two or three times a week. I have two kids at school and there are requests for money every month – just this morning I had to write one for Β£50. I do not want to send the kids to school with cash and am not convinced that technology would make it quicker and easier than scribbling out a cheque quickly when you are nagging off spring to brush their teeth! I do not know what I would do without it…

John W says:
24 November 2010

I am a sole trader – consultant. I receive up to thirty cheques a year. It will need to be a very simple alternative to beat the flexibility of cheques – no equipment, no e.account, simply pen and paper.

The only reason to faze out cheques is the cost to banks. Does everything have to make a profit – is there no place for service.

If I was running a high street bank, I would keep a cheque system and watch the customers beat a path to my door.

David says:
24 November 2010

I am treasurer of a small charity and write cheques to pay a variety of bills. In common with many businesses, all of our cheques need to be signed by two people. You just can’t do that with credit or debit cards…

I used my cheque book today. I am an OAP and find cheques the most convenient way to pay tradespeople etc. The gardener, my cleaner, milkman, papers. etc are regular payments.
Why should banks stop supplying something that their customers find useful? A few years ago banks were there to serve their customers. Now they are only interested if they can charge you for some service or other, instead of wanting to help you.

Of course cheques should remain, other wise small and to a lesser extent medium size business will not manage to continue to operate. I used to deal with farmers and even today they mostly still use cheques for a large part of their business dealings.
Also what about clubs and societies , most of these still use cheques for goods and services and many members of clubs still pay their annual fees by this method.
The banks must be persuaded to keep the cheque system until a similar system (not the debit card )is introduced.
Failure to do so will result in an ever bigger “black ecenomy with less revenue for the tax coffers.

Clive says:
25 November 2010

Like others, I say keep the cheques. I am the treasurer of our village church and almost all bills and donations to the church are by cheque. My local bank will not issue ‘the church’ with a credit or debit card, so cheques are our only means of payment outside of cash. I recently tried to buy a christmas tree for the church at Wyvale Garden Centre and they refused to take a cheque – “company policy” – so we had a stand off. In the end I paid with my personal card and then wrote a cheque to myself!

I’ve had a few stand offs in shops over cheques too. Interestingly one major high street chain which was telling my 83 year old mother that nothing in the world COULD (never mind would) change their policy of no cheques changed their mind very suddenly and without consulting management when she told them that if that was the case they’d better cancel the Miele washer / dryer at about Β£1200 that she had just ordered and for which they had just filled out the paperwork. Funny that ………….