Some Info On Cheques Needed

sparkly82

I've noticed over the past year that alot of shops are starting to refuse cheques as a method of payment. Does anyone know a reason for this?

And will this mean that i'll eventually stop getting a cheque book from the bank cos no shops will accept them anymore?

I find it handy using a cheque, especially if its a couple days before pay day if I need 2 buy shopping.

MarkyMarkD

Shops are refusing to accept cheques because:

- they hold up the queues as they are slower to sign than card transactions;
- they cost the shops more to process than debit card transactions;
and
- they are higher risk for the shop because a chip+PIN transaction shouldn't get rejected by the bank whilst a signature transaction can get rejected if the signature isn't a convincing copy of the original.

gt94sss2

sparkly82 wrote: »

I've noticed over the past year that alot of shops are starting to refuse cheques as a method of payment. Does anyone know a reason for this?

Processing/accepting cheques takes a lot longer for the retailer (i.e. queues build up in shops) and its also more expensive then accepting a debit card. Then there is the increased possibility of cheque fraud, compared to other payment methods.

And will this mean that i'll eventually stop getting a cheque book from the bank cos no shops will accept them anymore?

Eventually - but it will be many many years before they disappear.

This is because cheques are still used for settling bills, posting money to others and paying those who can't accept card payments.

On some bank accounts, its already optional if you want one or not.

Of course, if bank fees come in for everyone - well in some countries, they charge you if you want a cheque book..

Regards
Sunil

LittleVoice

gt94sss2 wrote: »

. . . - well in some countries, they charge you if you want a cheque book..

We used to pay for cheque books here too - we paid for the stamp duty which was applied to every cheque. I think it was 2d/cheque and ended in the early 1970s. Does anyone remember exactly when that happened?

Tao81

They'll start to refuse cash next, I don't doubt:mad: Give some pathetic excuse about it costing too much for a human to count and bank it. Damn annoying - why is it big business doesn't know where to stop in the greedy stakes? Whatever happened to customer choice and service above profit margins??!! My biggest beef is with those companies who use strong arm tactics to back you into paying by DD:mad: I do everything in my power to resist, I don't care...Keep charging me extra, stuff your DD's where the sun don't shine!!!!!

When I was at business school I remember the banks being challenged regarding not clearing cheques for 5 days - answer - our customers prefer this arrangement due to being able to make out a cheque a few days before pay day is due, suits them because of all the money they accrue in the mean-time from paid in cheque transactions, they cream in huge profits for it sitting 'in limbo' for 5 days!!! It's not about customer satisfaction, preference or care its about profit, profit and more damn profit. They only play the 'we want to assist our customers with their preference' when it suits their pockets. Otherwise you can like it or lump it - they'll do what they want regardless of how you prefer to carry out your affairs. Hypocrites!!!!!!!!!!!!!!!!!!!!!!!!

MarkyMarkD

Calm down, tao.

Cheques clear (for value) on the third working day. Their clearance is symmetrical - they are debited to the account of the person drawing the cheque on the third working day, and they are credited to the account of the person banking the cheque on the third working day.

There is no "creaming in huge profits" on cheques - the banks don't make ANY money at all on this three day processing cycle.

IF banks take MORE than the standard three day cycle to clear cheques, for interest purposes, then they are making some money out of it - but most do not, other than on "basic" bank accounts or savings accounts (where the extra clearance period is due to increased fraud risk).

The only transactions on which banks DO benefit, as a matter of routine, from clearance delay are BACS transfers.

DD is same day value. Salary credits are (usually) same day value. It's just standing orders and online bill payment-type transactions which suffer from clearance delay to the benefit of the banks.

Tao81

MarkyMarkD wrote: »

Calm down, tao.

Well, I stand corrected!
However, still anti-greed and it's rife within big Companies and Banks alike, not exactly transparent with a lot of their dealings with us mere mortals are they?!!.......... I think Martin might just agree with me on this one?!!:D

Wishing all the best and thanks for your input MarkyD.

angela110660

I agree with TAO81. Cheques really help stretch the last few days of the budget before payday for things like food shopping etc. Sadly I can no longer pay for my food by cheque and the payment is out the following day usually whereas in days of the cheque it could take up to a week!
Cheques will be redundant sooner than later if everyone stops using them to pay for things so USE THEM AS MUCH AS YOU CAN WHERE IT IS POSSIBLE.

daznorthants

I have been lead to understand (maybe incorrectly) that is an offence to right a check knowing there are not cleared funds. i.e. if you pay for some reason didn't arrive!

I suspect as well as saving money cheques are a criminals gold mine. So easy to forge and cheat the system. Shops have easy way to check unless they use Transcheck service, which is often not worth it.

LittleVoice

daznorthants wrote: »

I have been lead to understand (maybe incorrectly) that is an offence to right a check knowing there are not cleared funds. i.e. if you pay for some reason didn't arrive!

Yes, incorrectly advised - at least in the UK, I don't know about the rest of the world.

MarkyMarkD

It's not illegal, but it's a breach of the terms and conditions of every current account I've ever seen.

If you constantly rely on using cheques to eke out your budget, shouldn't you work on cutting out a bit of expenditure so that you can live a bit less "hand to mouth"? It's not good practice to rely on cheque clearance times.

Or simply agree an authorised overdraft for the "eking out" amount - and pay a few pence in interest each month.