‘No case’ for cheque guarantee cards - Money - News - Moneyfacts


‘No case’ for cheque guarantee cards

‘No case’ for cheque guarantee cards

Category: Money

Updated: 20/12/2011
First Published: 20/12/2011

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The will be no return for the Cheque Guarantee Card Scheme after the Payments Council found there was 'no case' for a reprieve.

The scheme, which came to an end in June this year, guaranteed that a bank would honour a cheque up to £50 or £100, even if there were insufficient funds in an account.

People paying would write their card number on the back of the cheque.

There had been concern that the move would limit how many people used or accepted the payment method, with the Treasury Select Committee saying that cheque use could 'die on the vine'.

But the Payments Council says that research shows there is no demand for the scheme to return.

More than eight in ten (84%) businesses said they still accepted cheques, with just 3% of firms no longer accepting the paper method because of the removal of the Cheque Guarantee Card Scheme.

In addition, just a single company of the 501 questioned said they had seen a detrimental impact on their business since the scheme came to an end.

Research also found that the scheme was often used incorrectly; four in ten people who use cheques said they has written their card number on the back of a cheque before posting it, despite the fact the guarantee is only applicable when payment is made in person.

"We've committed that cheques are here to stay, so we were pleased that the demise of the guaranteed cheque has had little impact on the way people use cheques, nor has it stopped businesses accepting them," said Adrian Kamellard, Chief Executive of the Payments Council

"It's particularly reassuring to find that older people have taken the change in their stride, however, our research has highlighted that there is a small minority of customers and businesses who might need extra help - so that will be what we're focussing on next."

Earlier this year, the Payments Council made a u-turn on its decision to abolish cheques by 2016, after research found that many people and businesses were against the change.

Find the best savings rates for you - Compare savings accounts

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

New Year tips to improve children’s money skills

How many have better budgeting as their New Year’s resolution? As with many things, these skills are best learned when young, so Lemonade Money has come up with some tips to help parents make their children more financially savvy.

Money worries lead to Christmas on credit

Money worries are putting Christmas at risk for up to five million Brits, with 10% saying they regularly worry about money in the lead up to Christmas, and the same proportion feeling stressed about how much they are spending.

Would you spend more for a character property?

We all have our own ideas of what makes a dream home, and for many, character features are at the top of the list. But how much more would you be willing to pay for those kinds of additions – and could they even help you save money in the future?