MSE News: Cheque guarantee cards to be abolished tomorrow

Consumerist

tiff wrote: »

As there was half an hour between kitty's two posts I would assume she since found the answer, no need to be nasty.

OK. Benefit of the doubt. I'll remove the edit. But I still have my suspicions.

Edit
Perhaps kitty will come back to explain what happened.

kitty2011

Thanks.

I fully understand the system will be going and that means the banks do not have to honour the cheques...

What i want to know is will i be able to continue to renew the dates on a monthly basis on the cheques to stop them from being banked? Does anyone know if payday lenders will continue to offer this even though they don't have the cheque scheme to fall back on? If not i will have to find £500 asap!

Thanks.

P.s - I'm not pretending to be 2 people, just clarifying my question for noodles86

kitty2011

... as noodles posted 'are cheques going'

Consumerist

kitty2011 wrote: »

What i want to know is will i be able to continue to renew the dates on a monthly basis on the cheques to stop them from being banked?

Banks, generally, do not have to refuse payment on post-dated cheques. The bank will disregard the date on the cheque and treat is as though it was dated prior to the current date. There is no way you can "stop" the cheque(s) being presented immediately; you have to trust the person you have given them to - to present them as agreed.

You can still write cheques. You can no longer give a guarantee that they will not bounce.

Hope that helps.

Edit
In the longer term, cheques may be going but this plan is currently under review by both the banks and government. In any event it is likely to be a few years before they are replaced.

jamesd

kitty2011 wrote: »

I borrowed money on a 'cash 'till payday' basis, which meant I gave the lender 5 x cheques made payable to them, which were guaranteed by my cheque card. The agreement is that they are banked 28 days later. As i have not had the money to cover repaying the entire £500, each month i have paid a fee for them to change the date on the cheque for another 28 days later.

i'm fully aware this is an expensive way to borrow and have plans in place to slowly pay these back one cheque at a time.

The bank would pay those whenever they were presented, ignoring the date written on them. You should check your account to be sure that they aren't presented for payment early to exploit the remaining guarantee time if you used the guarantee scheme that's ending.

To repay, take a look at the deals on offer from Lenders Compared. Tht is the site set up for doorstep lenders and similar loans as a result of the Office of Fair Trading investigation into them. It usually has much cheaper deals than you get from payday loans and could save you a lot of money.

If you think it would take six months to clear all of your cheques you might try taking out a loan for a year and then making overpayments. The repayments for a year will be lower so your required payments will be lower if you have a bad month but you'll still be able to overpay as much as you're able to to reduce the cost.

The deals there are so cheap compared to payday loans that it'll be very hard for you to get a worse deal even at APRs of 500% and higher.

kitty2011 wrote: »

after today, the bank will no longer guarantee to pay it if you've written your card details on the back of the cheque.

The banks haven't ever guaranteed payment if you wrote your card details on the back. The schemes require that it be the merchant who does that, not the customer.

ALIBOBSY

jamesd wrote: »

The bank would pay those whenever they were presented, ignoring the date written on them. You should check your account to be sure that they aren't presented for payment early to exploit the remaining guarantee time if you used the guarantee scheme that's ending.

To repay, take a look at the deals on offer from Lenders Compared. Tht is the site set up for doorstep lenders and similar loans as a result of the Office of Fair Trading investigation into them. It usually has much cheaper deals than you get from payday loans and could save you a lot of money.

If you think it would take six months to clear all of your cheques you might try taking out a loan for a year and then making overpayments. The repayments for a year will be lower so your required payments will be lower if you have a bad month but you'll still be able to overpay as much as you're able to to reduce the cost.

The deals there are so cheap compared to payday loans that it'll be very hard for you to get a worse deal even at APRs of 500% and higher.

The banks haven't ever guaranteed payment if you wrote your card details on the back. The schemes require that it be the merchant who does that, not the customer.

We had some issues 6 yrs ago or more when we got into trouble with one of these cash till payday type places, because of our other issues at the time we couldn't get a loan anywhere, but the company itself did do loans as well and were able to convert the cheques into a short term loan-horrendous interest rate but at least we knew what we were paying each month with no worries about going up and exchanging cheques/worrying anout cheques bouncing or charges and after 6 months it was finally cleared. That and the overdraft were the best things we got paid off such a relief.

Best bet might be to contact the company themselves, I would imagine they have some kind of plan in place to sort this as its a big part of their buisness. Many of the online ones like wonga etc just hold your debit card details and use that. i believe they work in the same way ie you can extend repayment month by month for a fee. I would imagine the cheque cashing companies will go along these lines.

Ali x

claire16c

I lost my cheque book about 8 years ago. I didnt bother to order a new one because I rarely used it anyway. And so Ive never used one since and cant think of an example when Id ever need to.

When I worked in a supermarket as a teenager, people paying with them used to annoy the cashiers because they took ages to process. The person always had to show their debit card along with the cheque anyway, so they could have just used that in the first place and would have been a lot quicker. Some people purely seemed to use cheques just because they liked doing so, not because they needed to.

tiff

I couldn't live without a cheque book. I prefer to use debit card most of the time but when you have kids at school its easier to pay for school trips and school dinners by cheque. Also they have lots of Scout activities that need to be paid for and like I said the dog kennels need cheque or cash. The barbers dont take debit cards so I paid by cheque there too. Pretty sure the school and scouts will be unaffected but not sure whether the kennels and barbers will refuse cheques now if they arent guaranteed.

plumber2009

@kitty2011

First of all, I assume you are with moneyshop.

The way moneyshop works is that if you extend your loan period by paying the fees, The cheques will not be presented for paymet as you are extending the period of the loan for another month.

When I use moneyshop and extend the loan I pay the "carry over" fees via debit card over the phone and if i wish to clear the loan then I pay the full amount. Money Shop only present the cheques for payment unless you fail to pay the full balance or "carry over" fees in shop or over the phone via debit card or cash.

fozmcfc

claire16c wrote: »

I lost my cheque book about 8 years ago. I didnt bother to order a new one because I rarely used it anyway. And so Ive never used one since and cant think of an example when Id ever need to.

When I worked in a supermarket as a teenager, people paying with them used to annoy the cashiers because they took ages to process. The person always had to show their debit card along with the cheque anyway, so they could have just used that in the first place and would have been a lot quicker. Some people purely seemed to use cheques just because they liked doing so, not because they needed to.

Thankfully it should see the total end of people who haven't even got a couple of quid in the newsagents and pay by cheque, they are really annoying people.

Only slightly less annoying are those people who can't even buy a chocolate bar and a paper in WHsmith without using a debit card.