New system to ‘replace cheques’ in UK
LONDON: UK banks are considering introducing a new paper-based payment method if cheques are phased out by 2018 as planned.
The UK Payment Council recommended last year that cheques be abolished but only when a suitable alternative has been established to replace them.
The plans have raised concerns from charities, consumer groups and the elderly who say that there is still a considerable minority of the public who rely on cheques and struggle with the concept of electronic alternatives.
Cheques will stay until a viable alternative has been devised by the industry to serve those who want to continue using a paper-based system. The Payments Council has promised that it will not leave consumers "high and dry" by rushing the changes through. Only 45% of consumers are aware of the plans to phase out cheques over the next eight years and of those that do know of the proposals, a quarter think that the target date for abolition is next year or 2012. The Council have announced that they will launch and education campaign to make the public aware of the planned changes and when they will be introduced.
The use of cheques has been in steady decline over the last decade but the Council have stressed that 2018 is only a target date and that the final decision will not be taken until 2016 at the earliest. If a viable alternative has not been devised by this time the date could well be pushed back. John Walker, national chairman of the Federation of Small Businesses (FSB), told the BBC: "The FSB is pleased that the banks are looking at an alternative paperbased system to replace the cheque. -PB News