Elizabeth Lumley - Girl, Disrupted - Crayford 07 December, 2010, 15:46 0 likes

Charities and services for old people are often mentioned, in regards to the abolition of checks. But anyone with a small child will know that most schools only take cash or checks for the wide range of school trips, uniforms, sports, photos etc... that you have to shell out for throughout the year.

Wouldn't the government be able to help state school migrate off of cash and checks?

Nick Green - ISD Consultants - Northampton 07 December, 2010, 17:57 0 likes

Elizabeth are these checks you use similar to the cheques that are being phased out?

Elizabeth Lumley - Girl, Disrupted - Crayford 07 December, 2010, 18:54 0 likes

Nick - try telling that to your average state primary in South London! 

Alexander De Lange - Aurelia Financial Consultants cc - Johannesburg 08 December, 2010, 11:42 0 likes

Surprisingly, such an instrument already exists: it called a CHEQUE

Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 09 December, 2010, 11:45 0 likes

@Finextra verdict:

If I were to guess, the paper alternative to cheque might be something like the German Ueberweisungsauftrag that used to be very popular when I was in Germany 7-10 years ago. In a paper version of SCT or SEPA Credit Transfer, the payer enters the payee name, bank account details, amount, and date into a preprinted paper form. After signing it in "wet ink", the payer hands over the form to their bank (unlike a cheque that is handed over by the payer to the payee). The payer bank converts the payment instruction electronically before forwarding it to the scheme (equivalent of BACS).

Although the payment originated in paper, it gets counted by the scheme as an electronic payment. 

This might just be the UK Payments Council's way of having its cake and eating it too!

A Finextra member 15 December, 2010, 11:10 0 likes

The abolition of cheques in 2018 does raise some concerns for the elderly and those who rely on cheques as their primary or only method of payment outside of cash. However, Direct Debit Limited is not convinced that a new paper based alternative is the way forward. As cheque usage continues to decline, we believe that Direct Debit is a safe and suitable payment method that will continue to gain popularity as we move closer to the abolition deadline. 

Direct Debit is easy to use.  As a result, some schools have already introduced Direct Debit for services such as school meals. It means that children don’t have to carry cash, it spreads the cost for parents and it reduces the administrative costs for schools. I would also argue that it is generally a much more efficient and safer way to pay compared with cheques, since consumers don’t have to worry about forgetting payments and in the unlikely event of an error they have protection via their banks. The Payments Council does have a massive challenge ahead, but we hope that more and more consumers and companies will realise the benefits of Direct Debit as 2018 draws closer.  

The planned abolition of cheques, whilst being an initial concern for some organisations, has also provided an opportunity for those smaller organisations such as playgroups, schools, charities etc. to move to a more efficient collection system. We are already seeing the start of a trend where more and more organisations are signing up to our bureau collection service to collect direct debit payments on their behalf. This means that an organisation can enjoy all the benefits of the direct debit system without having to commit staff time etc. to run it.