The cheque is 350 years old today, but this is expected
to be its last major landmark asautomated paymentstake
over.
On this day in 1659 the first cheque for making a payment was
written. Automated payments, such as using a card or online
banking, account for massive amounts of payments made in the
UK.
The use of cheques peaked in 1990 but has dropped significantly
since. Today two-thirds of under 25s have never written a cheque,
and the method of payment is unlikely to reach its 400 year
celebration.
"It would be fair to say this is the last big birthday the
cheque will celebrate," said a spokesperson at the Association of
Payments and Clearing Services (Apacs). "This is because more and
more people are using automated payment methods or plastic."
She said the Payments Council has been tasked with managing the
decline of the cheque, although no date has been set for it to be
fully replaced. "Cheques will not stop until a replacement is
found," she said.
According to Apacs, in 2008 there were six billion automated
payments, compared with 1.4 billion cheque payments.
Ralph Silva, analyst at TowerGroup, said the use of cheques will
diminish to a very low level but until there is an alternative they
will not disappear.
"Elderly people that are used to them will carry on using them
and the next generation will still use them for things where there
are limited alternatives, such as giving money as a gift."
A history of the cheque
1659 Date of the
earliest known surviving English cheque
1717 Bank of
England introduced printed cheques
1770 Daily cheque
clearings formalised
1811 First known
personalised printed cheques produced
1821 Committee of
bankers formed to regulate clearings in London
1833 First
clearing house built in Lombard Street, London
1939 Clearing
transferred from London to Stoke-on-Trent due to World War II
1946 Clearing
transferred back to Lombard Street, London
1965 First cheque
card issued allowing sterling cheques to be guaranteed up to the
value of £30
1966 First credit
card, Barclaycard, introduced in the UK
1969 UK Domestic
Cheque Guarantee Card Scheme introduced
1985 Cheque and
Credit Clearing Company established
1987 First debit
card, Connect, introduced in the UK by Barclays
1989 First
telephone-only bank, First Direct, introduced
1990 Peak year for
cheque volumes
1996 Scottish
cheque clearing with Scottish Exchange came under the
responsibility of the Cheque and Credit Clearing Company
1997 First
internet banking service introduced by Nationwide
2005 Shell stopped
accepting cheques
2005 London
Exchange moved to Milton Keynes and renamed the English
Exchange
2007 Cheque
volumes declined by fastest rate ever
2007 2-4-6 changes
introduced to cheque clearing process giving customers certainty on
cheque funds for the very first time
2008 Most major
retailers stopped accepting cheques
2008 Faster
Payments Service introduced for online, phone and standing order
payments. Payments Council published National Payments Plan
suggesting active management of the decline of the cheque is
required,with a possible closure of the cheque clearing in
2018.