UK to phase out cheques by 2018

Dec. 17: Britain has decided to phase out the use of cheques and promote alternatives that are acceptable to cheque users.
Cheques, which will include banker’s drafts and building society cheques, will be totally phased out by October 31, 2018, the Payments Council, which sets strategy for UK payments, announced.
The use of cheques has been in decline since 1990 and has fallen by 40 per cent over the last five years. “Cheque use is in long-term, terminal decline,” the council said, giving reason for its decision to end the use of cheques as a mode of payment.
Cheques were introduced in Britain as a mode of payment in 1659 and this year marked 350 years of their use. However, the cost of processing cheques for banks is very high and in 2008, the figure was £1.4 billion. To add to the cost, 45,000 trees were cut down to make cheques in 2008.
The peak year for number of cheques in the UK was 1990 when 11 million cheques were written every day. However, in 2007-08, just under four million cheques were written each day, compared to 14.8 million debit card payments.
The council will critically review the payments system in 2016 and will decide whether sufficient change has occurred to press ahead with its decision to do away with the cheque in 2018.
“Over the next nine years, the Payments Council will seek to promote and explain existing alternatives; and where innovation and new options are required to ensure that they are put in place. The goal is to ensure that by 2018 there is no scenario where customers, individuals or businesses, still need to use a cheque,” the council said.