The use of paper cheques in the UK could disappear within the next five years, according to research conducted by NOP for the Halifax.
Almost half (46%) of people interviewed by NOP use cheques less frequently than they did three years ago - indeed 14% of current account holders currently never use cheques, whilst 30% only use cheques once a month. Significantly 33% said their use of cheques will decline over the next 3 years.
Almost two-thirds of current account holders agreed that cheques will eventually be phased out. Almost half (45%) of these respondents said cheque usage will disappear within the next five years, while 81% said the phase out would take 10 years.
Even though the majority of respondents agreed that cheques would ultimately disappear, only 36% actually thought that phasing out the payment method was a good idea.
The Halifax cites industry figures from Apacs that show that cheque usage is the only payment method that has declined over the last 10 years - and the downward trend for cheque transactions is expected to accelerate over the next decade. Cheque usage is declining at a rate of around eight per cent each year.
The bank says plastic card payments now account for twice the number of cheque transactions, with 4.8 billion card transactions compared to 2.4 billion cheque payments. By 2008 the volume of payments made by plastic cards is expected to reach over 7 billion, compared to 4.8 billion in 2002.
The number of debit card transactions overtook the number of cheque transactions for the first time in 2001, according to research by Apacs, with 2.6 billion debit transactions compared to 2.5 billion cheque payments during the year. This trend accelerated in 2002 with 2.99 billion debit transactions compared to 2.4 billion cheque payments.
According the NOP survey, 59% of current account holders currently use debit cards at least once a week, with 15% saying they use them at least once a day.
Despite this, Halifax's research shows that cash is still the most popular form of payment, with 64% of current account holders using cash most days. Only 23% of respondents felt they would use less cash in the future.
Rob Devey, head of banking at Halifax, comments: "The survey clearly demonstrates that fewer and fewer people are using cheques, preferring instead the convenience and speed of electronic payments. Cash and debit cards are clearly the currency of today."