End of cheque guarantee system

vic_sf49

Having experienced life in the USA, I've discovered that to pay by cheque is the norm. When initially setting up accounts to pay my utilities, some companies had to call for help as they didn't know how to set up a direct debit. When it comes to my rent, anything but a cheque (or bankers draft equivalent) incurs extra costs.

I prefer the ease of having regular bills paid automatically and certainly don't want to have to use cheques for everything. However, when making a one off payment for birthdays or other random situations, being able to send a cheque is invaluable. I do not want to run up a massive phone bill transferring money and do not always have internet access for setting up on-line banking transfers, and of course being out of the country makes a trip to my local bank a bit problematic.

Cheques over here are actioned / cleared on the same day, and act just like cash and electronic payments. They're even scanned in so you can remember what you wrote the cheque for - assuming you wrote it on the cheque in the first place.

I like the speed with which funds clear here and wonder why the UK isn't the same. A UK cheque is entered into the system when you're at the counter in the branch, so I've never understood the delay in clearing the funds. I wonder if more people would use them if they cleared quicker.

I for one would like the option to be able to use cheques as and when required.

rb10

jennifernil wrote: »

Even dual authorisation on bank transfers can be very difficult to arrange.

Not if you have at least two signatories with internet access.

The facilities currently offered by CAF & Unity Trust, and coming to HSBC in March, allow one user to set up the payment, and then another user to (at some other stage - could be 30 secs or 3 weeks later) approve the payment.

They don't have to be in the same place, at the same time. They just have to both have accessed the online banking site before the payment can go out.

jennifernil

Yea, it's the "3 weeks later" bit that payees would not be/are not happy with!!

We bank with BOS and have dual authorisation on transfers.

savingspender

HSBC do allow charity accounts to have a credit card as we now have one. Obviously you would need to put procedures in place to ensure that it is used as required but it does make things a lot easier and prevents anyone having to have the burden put onto them to purchase higher cost items.

dzug1

There are still things called postal orders, purchasable with cash, and either cashable or payable into a bank account.

They are quite expensive though - which probably accurately reflects the cost of running such a system.

How do countries that have already abolished cheques manage? Perhaps that's where we should look for ideas.

rb10

savingspender wrote: »

HSBC do allow charity accounts to have a credit card as we now have one. Obviously you would need to put procedures in place to ensure that it is used as required but it does make things a lot easier and prevents anyone having to have the burden put onto them to purchase higher cost items.

Jennifernil was talking about her Guide hall. Credit cards are impractical for Scout Groups and Guide Units, as their own (current) rules state that you must have two signatories for any withdrawal.

huw01

Well I'm going to a wedding this weekend. They are having a cheque as a wedding present from me. Ideal in these instances, more secure than cash in an environment like a wedding reception.

It would be a bit impersonal for the bride and groom to put their sort code and account number on the wedding invite wouldn't it !

ERICS_MUM

CLAPTON wrote: »

postal orders are cheques

They are more like a draft, considered as cleared funds.

rb10

ERICS_MUM wrote: »

They are more like a draft, considered as cleared funds.

This is another place where many people's knowledge of cheques is sadly lacking.

Many people believe that bankers' drafts are considered as cleared funds.

This is incorrect - they go through exactly the same clearing process as normal cheques and are subject to the same timescales.

ERICS_MUM

rb10 wrote: »

This is another place where many people's knowledge of cheques is sadly lacking.

Many people believe that bankers' drafts are considered as cleared funds.

This is incorrect - they go through exactly the same clearing process as normal cheques and are subject to the same timescales.

My use of the word "cleared" was wrong, I agree. Obviously the draft has to go through the clearing process for the funds to be exchanged between the two banks, and for the drawer's bank to complete the technical checks.

I should have said that payment of bank drafts cannot be stopped by the drawer, funds have already been taken from his/her account and are held by their bank. I believe postal orders work in the same way (i.e. bought and paid for "up front").

If this too is wrong, could you explain it to me please.