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I suspect the banks will take a middle ground. Progressively higher charges, starting at £5 for a new cheque book, and 50p per cheque for both payer and payee. Charges will ramp up until demand finally dies out.
The reason that there are still so many cheques is that the fees are not yet aligned to the costs.
As per the comment above - once the true costs of processing each cheque are charged to the drawer and the payee, then the use will drastically drop until it is only used for specific mandated transactions.
I recently had to send a cheque for £2 for a kids swimming badge. I would hazard a guess that the costs to both my bank and the recipients bank would be a huge % of that amount and hence it is a totally inefficient payment method.
In today's financial world, inefficiencies are constantly being challenged and ruthlessly removed. Paper statements are being replaced by eStatements and paper bills by
The cheque is not a holy cow and will eventually suffer the same fate as all inefficient processes.
This is little more than the usual "3 card trick" used by banks all the time.
1. Bleat on for months about how expensive something is.
2. Highlight alternative services which are much cheaper / safer / convenient.
3. Threaten to withdraw the service, listen to the protests and then responding to "customer pressure" by offering to keep the service going but charge like a wounded bull for it.
One of these days a bank will emerge that puts it customers needs before its shareholders, now that would be news!
What is interesting about this news article are these words "UK BANKS VOTE..." A consortium voting, agreeing, on what products and services to offer...
Is it just me or does anyone else recognize this as cartel behaviour which should be prohibited?
If bank A no longer wants to issue cheques, then it should do that on its own. Bank Z who still recognizes the need for consumers to use cheques can decide on their own to offer what their customers want.
Cheques were abolished in practise here in Finland in 1983 - by introducing the equivalent of 8 cents fee per form.
It is time to move forward all over the place from this slow and expensive method of payment.
Where is the most important opinion? The opinion of CLIENTS !!!???!!!
Who cares if all the banks agree to vote "NO"?
In France, cheques are still widely used (Sorry, we are roughly 30 years behind Finland but we're doing our best).
You can pay your bills, pay a peer, delay or divide payments...
And "8 cts fee per form" is not an alternative for the french market. It would certainly be a new revenue for the bank but not a new option for the clients.
This post is from a series of posts in the group:
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