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Electronic banking still to convince many customers

Thu, 09 Dec 2010

The Payments Council have stated that many bank customers would prefer a paper cheque alternative to electronic banking if cheques are abolished in 2018 as planned. The organisation argues that such a scheme could implemented if a large number of people were still finding it difficult moving over online systems of banking.

The Payments Council, which announced plans to phase out cheques last year, claim that the present cheque clearing system will only be got rid of if other acceptable alternatives are in place. Since the announcement, they have received pressure from groups who want to see some sort of paper-based system continue, despite the use of cheques declining steadily over the last few years.

Paul Smee, chief executive of the Payments Council, commented "Cheques will continue until alternatives are in place." One option being discussed in the industry is a new paper voucher system, as well as other electronic means, including text message by mobile phone .

Charities receive many donations in cheque form, and many older people prefer to use cheques for much of their personal finances, rather than e-banking or by telephone. Michelle Mitchell, charity director at Age UK, countered "The announcement does nothing to reassure older people that an acceptable alternative payment system will be in place before cheques are withdrawn."

Research by the Payments Council found that just under half of all people in the UK are aware that the cheque clearing system is due to close in 2018.
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