Cheque guarantee scheme to close in 2011
The cheque guarantee scheme is to close on June 30th 2011, meaning that alternative payment methods will have to be found such as debit or credit cards, it has been reported.
The decision to close the scheme was taken by the Payments Council since its use is in terminal decline.
Banks and building societies who currently offer these services will ensure businesses who still accept guarantee cheques, as well as consumers who write them, will be made aware of the closure date and alternatives will be suggested.
The decision follows news that of the 1.4 billion cheques written last year, only 7% were guaranteed.
This is a decrease of one third from the year before and a decrease of 70% in the number of guaranteed cheques in the past five years.
Jacqui Tribe, manager of the UK Domestic Cheque Guarantee Card scheme says: "Now an industry-wide date has been set we can look to support customers through the change by providing information on what this will mean.
"The alternative was to let the scheme wither on the vine - which was more likely to have led to confusion, mixed messages and potentially exposing more customers to the risk of fraud."
According to the UK Payments Administration, over 99% of the 59.9 million cheque guarantee cards that are still in use are also either debit or credit cards.
The organisation defines the cards as a plastic card used with a cheque as a guarantee to the recipient that the bank with pay the value of the cheque, subject to conditions.
Written by Sarah Wilkins ©
