Cheque clearing to go from six to one weekday
As part of the image-based cheque clearing system being introduced by The Cheque and Credit Clearing Company (C&CCC), it will be quicker to process the transaction from 30 October this year.
It means that if customers pay in a cheque on a weekday, they will be able to withdraw the funds by 23.59 on the next weekday latest (excluding bank holidays).
This also means that when a cheque is paid in, the recipient will receive the money in the account much sooner and the money will also leave the account of the person or business faster.
The C&CCC said the system will go live with some banks and building societies before being rolled out to all the industry in the second half of 2018.
Although cheque usage is declining, 477 million were written in 2016.
How will it work?
Customers will still write and pay-in cheques in the same way as they do today, but with cheque imaging, banks and building societies may offer their customers the additional option of paying-in an image of the cheque – by using a secure mobile banking app on their smartphone or tablet – rather than having to go to a bank to pay it in.
Some banks have already rolled out imaging technology for some of their customers, but only where they receive a cheque from another customer of the same bank.
The C&CCC said that ultimately the new system will see cheques from all banks and building societies cleared via image to the faster timescale, even when the cheque writer and cheque recipient are with different banks and building societies.
James Radford, chief executive officer of the C&CCC, said: “These changes will put cheques firmly in the 21st century, delivering real and important benefits for the many individuals, charities and businesses that regularly use cheques. Not only will cheques clear faster but banks and building societies may offer their customers the option of paying in an image of a cheque rather than the paper cheque itself.”