Payments Council decision to keep cheques welcomed

Payments Council decision to keep cheques welcomed

News (UK)

Cheques will remain for as long as customers need them the Payments Council announced this week, abandoning a plan that might have seen the closure of cheque clearing in 2018.

The decision has been welcomed by the Association of Charitable Foundations (ACF) and the Charity Finance Directors’ Group (CFDG).

Carol Mack, deputy chief executive of ACF, a member of the Charities and Voluntary sector liaison group for the Council, said: “In a survey of our members over 90% told us that they use cheques to make at least some of the grants they awarded. Cheques have the advantage of being low cost and simple to produce, with low transaction costs for grant-makers. They are particularly helpful to those foundations that make a large number of one-off grants of relatively low value to a wide range of differing organisations and individuals."

 Mack emphasised the need to see low cost workable alternatives with low transaction costs made widely available before cheques can be phased out. “We have actively represented these views to the Payments Council and are pleased that they have responded to the concerns that we and others have expressed. We hope that cheques will continue to be a cost effective payment option for charities and that work by the Payments Council to encourage the development of innovative, secure, low-cost payment methods will continue.”

Caron Bradshaw, CFDG’s CEO, commented: “So many charities rely on cheques for both making payments and receiving donations and the 2018 date was simply too ambitious.  Although the Payments Council put considerable effort into engaging with the sector on the issue, there remained a number of significant concerns which we outlined in our evidence to the Treasury Select Committee inquiry.  In our minds, the decision to withdraw the target end date is, at this time, a sensible course of action to take.”

Bradshaw continued:  “While this is clearly good news for all those charities set to be affected if cheques were withdrawn, we hope that this will not mean work to develop more secure, cost effective and efficient forms of payment stops.  We understand that the Payments Council will continue to work to encourage innovation in methods of payment and we will work with them and the banks to ensure charity interests are represented.”

The Payments Council Board says it will continue to focus on security, efficiency and encouraging innovation in all types of payments to ensure customers have options best suited to the 21st century.

Richard North, chairman of the Council said: "It's in the DNA of the Payments Council to consult and listen to all those people who actually make payments and use cheques. Listening to over 600 stakeholder groups, working with the banks and following our appearance before the Treasury Select Committee, we have concluded we should reassure customers that the cheque is staying.

Over the last two years we have learnt a great deal about what is important to our many stakeholders and we are really grateful to all of those groups and individuals who took the time to talk to us and help us reach this decision. We will use what we’ve learnt to keep improving existing systems, as well as introducing innovation, so that customers benefit from 21st century ways to pay.  Innovation must be at the heart of what we do.” 

 

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