Britons will soon be able to clear a cheque in just 24 hours with the help of their Smartphone or iPad, the Cheque and Credit Clearing Company (C&CCC) has announced.
The software will be installed and ready to use in all UK banks by the end of next year with the rollout beginning from October 30. People who do not want to use the new system will be able to use the cheques by post or via a branch of the same bank. Other countries to have image-based processes in place include the US, India and China.
James Radford, the chief executive of the C&CCC, said that the move would ‘put cheques firmly in the 21st century’ and benefit ‘the many individuals, charities and businesses that regularly use cheques’. However, some people are concerned that the new system could throw up fraud issues, pointing out that banks currently keep paper copies of cheques for authenticity if need arises. One UK lawyer mentioned that this could mean ‘the bank never gets the paper copy and the customer is encouraged to get rid of it after seven days’. He also diverted attention to the risk factor involving photos of these cheques to be manipulated or photoshopped.
Introduction of this system will mean UK cheque users – who cashed 477M payments in 2016 – could observe the time it takes to clear a cheque fall from six working days to only one, without any requirement to visit a bank branch. This UK–wide system will mean cheques can be cashed in even if the cheque writer belongs to a different bank.
Regulators and the government initially wanted to have this system in place last summer but progress to get the technology has been gradual and the launch had to be delayed.