Cheques bouncing into history
. Banking & Finance, Project Specialist.
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UK banks have voted to stop the cheque clearing system in 2018. If a viable alternative exists at that time.
The press are having a field day, but most of them ignore the stated proviso of a working alternative. Its the old “system” which is costly and supporting dwindling volumes. My own reading is that the date is currently more about “concentrating minds” on developing alternatives, as a review date is slated for 2016.
However cheques as we know them are going – even if the end-date might slip a bit – and businesses that issue or receive them do need to start strategic planning for alternative settlement methods. In truth these already exist for businesses who can pay electronically via BACS, collect settlements via direct debit, or accept payments through online media. And on payment-by-payment basis, these should all represent cost savings on the bank charges overhead!
It is worth restating that the “Payment Council” which represents the bank has reassured the public that viable alternatives are a pre-requisite of closure, with a statement , saying: “The goal is to ensure that by 2018 there is no scenario where customers, individuals or businesses, still need to use a cheque. The Board will be especially concerned that the needs of elderly and vulnerable people are met.” Hopefully after a day or two of journalistic hot air the debate can move to identifying and developing an alternative paper/signature based solution.
- One of Expense Reduction Analysts most experienced and widely respected consultants, Steve joined ERA after a successful bank management career.
- A highly effective negotiator, Steve heads ERA's UK Banking Team in projects that gain significant savings for clients of all sizes and industries.
- A recent "Associate of the Year", Steve has successfully used his skills to achieve significant savings for clients ranging from family businesses to quoted international groups.