A replacement for cheques?

jimbob_too

There's not a lot to watch on TV at the moment so I am watching a screening of the Parliamentary Select Committee on the 'End of Chequebooks' (BBC Parliament Channel).

The banking bodies are proposing that cheque books should be phased out in the next few years. Some of the other participants are suggesting that there is a group of people, such as the elderly, who find the alternatives to cheques too difficult or inconvenient to use.

But isn't there a very simple replacement for making small transactions without using a computer or a card reader? If I wanted to transfer money to Mr. X (who might be the plumber or EDF energy or whoever) I could just write a quick note on a piece of paper to my bank, i.e.

'I Jimbob have an account no. 1234567, sort code 12-34-56 with your bank. Please transfer £25 to Mr. X, Bank of Scotland account no. 7654321, sort code 65-43-21.

Yours etc.

<signed>'

Has anyone tried to do this, or works for a bank and confirm that it's legit? I'm sure I've heard before that this is acceptable to the banks, but can't find a source for it. It does seem less secure, though.

(Please note I haven't any plans to do this - I'm just interested since the people on BBC Parliament haven't bought it up)

stclair

You can transfer money in branch, into anyones account as long as you have the correct account number and sort code.

MoneySavingUser

But then anyone could write that on a piece of paper and forge the signature? at least with a cheque book they have to steal it first?

MiserlyMartin

I hope they do phase out cheques purely for the fact that ISA's will have to be overhauled so that they do electronic transfers instead of this shambles that involves drawing a cheque, sending it in the post and waiting and hoping the post office don't lose it... and your interest while it is in between accounts!

Although it will be a shame not to have the option to pay people by personal cheques via post.

Quiet_Life

Have just received ballots to sell for a large national charity. When sold you have to return the completed ballot stubs and a CHEQUE for the amount of the ballots sold. What are these charities going to do when cheques are phased out? What will replace the large cheques you see on fund raising programmes like comic relief, wil they be replaced by large copies of bank transfers?

crispy_chris

If theres no suitable replacement they wont be discontinued.

simongregson

jimbob_too wrote: »

T
'I Jimbob have an account no. 1234567, sort code 12-34-56 with your bank. Please transfer £25 to Mr. X, Bank of Scotland account no. 7654321, sort code 65-43-21.

Yours etc.

<signed>'

Surely what you have described is in effect the same as a cheque

Olipro

what's the replacement? expand the role of cardreaders.

you use the sign function of your cardreader to generate a one-time code for a specific amount and account number - the person with that account number gets the code and passes it to their bank along with your account number.

rb10

Olipro wrote: »

what's the replacement? expand the role of cardreaders.

you use the sign function of your cardreader to generate a one-time code for a specific amount and account number - the person with that account number gets the code and passes it to their bank along with your account number.

I don't think that cardreaders are the way forward.

If only text messaging could be made more secure, then that really would be a convenient way of instructing your bank to make a payment. Or something else that's mobile phone related.

Fire_Fox

rb10 wrote: »

I don't think that cardreaders are the way forward.

If only text messaging could be made more secure, then that really would be a convenient way of instructing your bank to make a payment. Or something else that's mobile phone related.

Some smartphones apparently have the capability for contactless payments and of course accessing internet banking. However the problem is that many people who are housebound or find it difficult to get out are on a low income so smartphones, PCs and internet connections may be beyond their means.

According to the ONS:
"In the highest income decile group, 98 per cent of households owned a home computer and 96 per cent had an Internet connection in 2008. This compares with 33 per cent of households in the lowest income decile group who owned a home computer and 26 per cent who had an Internet connection.

Growth in mobile phone ownership has been moderate since 2001/02, increasing from 64 per cent to 79 per cent in 2008. Only 61 per cent of households in the lowest income decile group reported ownership, compared with 88 per cent in the highest income decile group."
http://www.statistics.gov.uk/cci/nugget.asp?id=868

usedandabused

i make a point of now paying with my cheque book now i have a cheque book account again, when i first had a proper current account, i took it for granted.
When i became subprime i lost it, that is when i realised there is a real need for cheque books, my aunt lives upon hers, now i'm operating norml accounts again i use my cheque for everything bar a few DD's for credit cards.

save my cheque book