The writing is on the wall that the humble cheque will disappear at some point in the not too distant future, but not just yet.
The Cheque Was due to End in October 2018
Back in 2009 the Payment Council decided that the cheque would cease use in October 2018, but after the Government stepped in they had to change, and they decided the cheque would continue for as long as necessary.
Decline of the Cheque
1990 saw the peak in cheque use at 4 billion transactions, but since that time we’ve seen a decline with 2015 seeing just under 550 million transactions using a cheque. With technology as it is and as the younger generation get older, fewer and fewer will use cheques.
Over 65’s Use More Cheques
It’s not surprising that the over 65’s use more cheques, partly because they don’t want to change and partly because they don’t understand the new technology. Incentives to use other means will become stronger as the number of cheques being processed becomes unviable.
Many Shops Have Stopped Accepting Cheques
Tesco, Asda, Boots, Sainsbury, Next are just some of the stores who no longer accept the good old cheque. Changing acceptance of new technology and stores refusing the cheque will push things along till the cheque becomes extinct.
Despite the Numbers, Use of Cheques is Strong in some Areas
Charities Rely on the Cheque (Research from Spring 2017)
Without the cheque many charities would be in trouble. A few figures that highlight this:
- 29% said they receive over half their donations by cheque
- 53% receive donation income by cheque
- 87% had either received or made a payment by cheque in 2017
UK Business and the Use of Cheques (Research from Spring 2017)
The use of the cheque was alive and well in 2017. Although their use is declining, we are clearly not ready to dispense with their use just yet with:
- 75% had either received or made a payment by cheque during the previous month in 2017 when the survey was carried out.
Personal Account Holders Use of Cheques (Research from Spring 2017)
In the past year from the time the research was carried out a staggering 55% of personal account holders had either sent or received a payment by cheque.
Trust Issue Just One Reason Cheques Won’t Die
There is still concern that hacking, stealing a phone, identity theft or other cyber attack could lead to your bank account being cleared out.
Interestingly, this is just part of the problem. What some might find surprising is that 12% of homes still don’t have broadband in the UK, so they can’t do online banking. On top of this only 66% of mobile users access the internet through their mobile. This means slower take up of technologies such as contactless payment.
Overall there are 17% of adults in the UK who don’t have broadband access whether fixed or through a mobile, which equates to just over 11 million people.
The Cheque is Here to Stay for a While Yet
A combination of trust, lack of access to technology, lack of understanding of technology and differences in viewpoint across the generations, create a situation where the cheque isn’t about to pass-on just yet. It’s clear we’ll be dealing with cheques for a few more years to come.