Consumers are increasingly shunning their chequebooks in favour of their debit cards.
Once the dominant payment method after cash, cheques are to be phased out in the coming years, with a target date of 31 October 2018 for them to be abolished.
And figures from the Payments Council show that the public are using cheques less and less.
Cheque usage dropped by £21.5 billion, down by a tenth in the second quarter of 2010, compared to the same period in 2009, with businesses and consumers switching to faster and more convenient payment methods.
Each day of the quarter, an average of 290,000 fewer cheques were written than the year before, over three fewer per second.
The use of cash machines, an indicator of the amount of cash used for transactions, also fell by £1.6 billion, a decline of 3.2%.
Credit card spending was also weak, rising by just 3.9%, barely ahead of inflation.
It represents a migration to debit cards, with the value of payments made on them rising by £7.9 billion year on year.
There was also a huge expansion in transfer activity. Faster Payment – transferring money between accounts – picked up the slack left by cheques, recording a rise of £16.9 billion, an increase of 67%.
It shows that consumers and businesses are taking advantage of being able to make instant transfers, a world away from the time when people were forced to wait for days for a cheque to clear.
The total value of payments in the UK economy fell by 0.6% in the second quarter of 2010.
"The payments revolution continues apace in the UK," said Sandra Quinn, director of communications. "Cheque usage is shrinking dramatically, while credit cards hold less appeal for consumers and businesses."
"We use cash less where there is an easy alternative, but we're years away from cash falling out of fashion. Debit cards are taking over our daily purchases, while Faster Payments are fast becoming how we transfer our money electronically."
"The overall payments figures show a distinct lack of energy in the UK economy. The recovery may be underway, but total payment values are not suggesting a dramatic return to strong growth."
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