Final sign-off for cheques is all but guaranteed
THE writing is on the wall for cheques. Their use is set to fall dramatically as banks will no longer operate the cheque guarantee scheme from the new year, it has emerged.
People will still be able to issue and accept cheques from next year, but they will no longer be able to guarantee their cheques by using a Laser/Maestro card.
The guarantee scheme is where Laser or Maestro cards double up as a cheque guarantee up to a certain value. Usually the guarantee covers up to €100.
The Irish Payment Services Organisation (IPSO), which oversees the cheque clearing system, said the era of cheque use was drawing to an end.
"It is true that the cheque guarantee scheme will cease from the end of this year," a spokeswoman for IPSO said.
And the payments body is anxious to remove cheques completely from the system by 2016, but a final decision rests with the Central Bank.
Irish people are among the most enthusiastic users of cheques in Europe, National Irish Bank economist Ronnie O'Toole said.
Central Bank executives and officials from the Department of Finance are now working on a National Payments Plan in a bid to get more people to switch from using cash and cheques to electronic forms of payment.
The Government has been attempting to wean people off cheques by hiking the stamp duty on them.
The duty on each cheque has jumped from 15c to 50c in recent Budgets.
It has been estimated that the high use of cheques and cash in this country costs around €1bn a year in security and handling charges.
Dr O'Toole said the high use of cheques and cash was perpetuating the black economy.