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Banking: Cheques

Answer

The Payments Council will reach a decision at the end of 2011 on what additional new cheque alternatives need to be developed. No decision will be made on whether to phase out cheques until these alternatives are in place and are being used by consumers and businesses. The Treasury is monitoring progress. There is no single replacement for the cheque. Some alternatives, such as debit cards, internet and phone banking payments, already exist. They may need to be adapted or made more widely available. Emerging solutions include mobile payments, prepaid cards and new forms of online payments. The Payments Council is consulting cheque users to identify where their needs cannot be met by the existing or emerging alternatives. The Payments Council has said that it will ensure a viable paper alternative is in place to satisfy the requirements of the most vulnerable members of society and will not close the cheque clearing system unless these alternatives are put in place. The Government are clear that any alternative system will need to replicate the flexibility and ease of use of cheques, while improving processing times and be cost effective. An alternative will need to have been tested in practice and be widely available, widely acceptable and widely adopted by users who do not currently have a suitable alternative. Until this is demonstrated, there is not a credible and coherent case for abolishing cheques. The Government are keenly monitoring the progress of the cheque replacement programme and are considering whether they may need to intervene to protect vulnerable individual and businesses if there is any threat that cheques may be withdrawn without suitable alternatives being put in place.

Secondary information

Type

Written question

Reference

9751; 728 c268-9WA

Session

2010-12

Related items

Banks: Cheques
Monday, 6 June 2011
Oral questions
House of Lords

Subjects

Cheques

Link

View this Written question on www.publications.parliament.uk