British banks are set to accept photos of cheques sent by smartphone, cutting the processing time from six to two days, the Treasury said on Thursday – but it insisted that this was not the next step in phasing out them out entirely.
The chancellor, George Osborne, is to consult next year on legislation to speed up cheque payments and make it easier for businesses and consumers to use smartphone technology. Consumers would also be allowed to send photos of cheques or go to banks with photographs of cheques in a move that mimic the way that plane tickets can now be printouts of emails.
In America, JP Morgan Chase introduced the cheque service in 2010, followed by Citibank and Bank of America. But in the UK, the law states the bank has a legal right to demand to physically see the cheque, especially if it is from a different bank, before it decides to honour it.
Welcoming the move, Steven Roberts, Barclays' managing director, said: "When you can download a book or a film in seconds, we believe you should be able to deposit a cheque in the same way. This is just the beginning of how we want to transform the 'cheque clearing cycle' for our customers, driving down the six days it currently takes a cheque to clear."
The Treasury said it accepts that despite debit cards, cheques remain crucial, with nearly £840bn-worth processed last year. This accounts for 10% of all payments made by individuals. A total of 23m cheques were sent as gifts since surveys show they are still the most trusted method of sending money through the post. But with cheques in overall decline, the Treasury said the new photo cheque would boost their status.
Source: theguardian
