Sorry if I missed this in the news but I've just had a variation to my terms and conditions from my bank saying the cheque guarantee scheme is closing on 30 June 2011?
So bye bye cheques?
Sorry if I missed this in the news but I've just had a variation to my terms and conditions from my bank saying the cheque guarantee scheme is closing on 30 June 2011?
So bye bye cheques?
More or less. There will still be some uses for them - mostly when posting funds to someone when there is no urgency to the transaction, I imagine. I very much doubt any retailers will accept them when there is no guarantee - most large retailers already stopped accepting them some time back.
It's bye-bye guaranteed cheques. There are plans to phase out cheques completely, but not quite yet.
Probably.
I had to pay a large bill to a government agency recently. They sent me the invoice but no electronic payment details so I called them and asked for the sort code/account etc so that I could pay by EFT. They had no clue and announced "we expect payment by cheque".
Joined up as ever, eh?
BTW, many banks are raising cheque charges to 97p/cheque and also imposing a supplementary charge based on a percentage of the value of the cheque. Check your T&Cs carefully.
The same is also being applied to cash witdrawals.
Greedy bankers' bonuses have to be paid somehow.
Most places (supermarkets, petrol stations) that only accepted cheques with guarantee cards stopped taking cheques a couple of years ago ...
Huh? What has the end of the cheque guarantee scheme to do with the government? In any case, you will still be able to write non- guaranteed cheques.
Huh? What has the end of the cheque guarantee scheme to do with the government? In any case, you will still be able to write non- guaranteed cheques. .........................................................................
Difference being that (now) the bank pays out on a cheque if there are insufficient funds, and charges the drawer; whereas in future, the bank WON'T pay the cheque if there are insufficient funds, but will STILL charge the drawer.
The current plan is cheques to be phased out in 2018 if suitable alternatives can be found. They have already pretty much been phased out for retail use, hence the demise of the cheque guarantee scheme next year.
Only for guaranteed cheques. My new chequebook received yesterday, the first from Santander, has 'not for use with a guarantee card' printed on every one.
So get your cheques elsewhere; there's no law saying you have to get them from the bank, they're just printed paper.
Mike
But will the Bank honour them?
If they have the correct info and signature, and you're not overdrawn, I think they have to. It's an old saw: 'you can write a cheque on anything'.
For instance:
That seems to be a North American site. I know that it is common for personal customers in the US to have personalised cheques, but in the UK?
The banks already have the option of rejecting any transaction other than a guaranteed cheque that would cause or increase an unauthorised overdraft. A lot of people would be better off if the banks did this, since then they would avoid daily overdraft fees and fees on further transactions.
Paging Mr Albert Haddock.
Many "old saws" are wrong, including that one.
It may be true in the USA, and it may even once have been true in the UK (although I'm not sure of that), but it isn't generally true in the UK now.
You will find that most modern bank accounts have T&C which state you can only write cheques using those supplied by them.
It wouldn't really matter anyhow, since cheque guarantees have only ever been valid subject to the specific T&C of the bank concerned, and if they say you can't have them any more, then you can't have them, regardless of whether the cheque has wording on it as shown above.
I had a booklet from Midland Bank in the shape of a Chequebook called "How a Chequebook works" it explained why it was better to keeo the money in a bank and how a cheque was just a piece of paper. It contained the anecdote: "a man once wrote one on an egg - it was cashed. Another man wrote one on a cow but that was a bit more complicated" The book went on to explain why it was easier to have all the info printed on the cheque for you and how to use the stubbs and record sheets etc.
if the egg and cow stories were true, and I remember doing transfers by letter though not quite the same thing, I am sure that 35 years of T&C revision will have brought in a solid egg and beef clause or two.
Back in 1977, myself and a friend tested this out using my account I have with the (then) Midland Bank: I wrote a cheque to him for £1 on the back of a concert programme. It was processed by hand, and I was charged £3 (I think) for having it cleared, and it took a little longer to clear. I have a vague memory that it was given a special description on the statement.
Of course, they may well have changed the rules in the meantime, as this was back in 1977.
I'm not sure I understand the 'hence' bit.
UKPA justifies all this by saying that 'guaranteed' cheque use is in terminal decline. But the 'guarantee' aspect really cost anything significant except when the guarantee is invoked? It's clearly useful to those who still demand the cheque is backed by the guarantee. Why not keep it until cheques themselves are killed off?
It looks plainly as though they want to get rid of cheques in any case, and have therefore sought to hasten their demise in the meantime by reducing their acceptability by getting rid of the cheque guarantee.
I was a bit surprised that they were all able to get together and abolish the cheque guarantee in concert. Cheque guarantees were available before any inter-bank 'scheme' for them was implemented, so the end of the scheme presumably doesn't imply that it's now impossible for any particular bank to offer a cheque guarantee card unilaterally.
The current plan looks a bit cartel-like to me.
Why should I want to?
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.