All is revealed in cheque clearing process
by Gill Montia
Story link: All is revealed in cheque clearing process
Despite the days of payment by cheque being numbered, the Cheque and Credit Clearing Company (C&CCC) as launched an online film that helps explain the different stages involved in clearing a cheque.
The “Animated Guide to the Cheque Clearing Process” is a two-minute video that tells the story of how a cheque is cleared, including how, when and why cheques are moved around the country and what happens when a cheque bounces.
The film also covers interest on deposits paid into an account by cheque; when funds can be withdrawn and when funds from a cheque can no longer be reclaimed by a bank.
C&CCC managing director, Angela Thomas, says: “Despite the fact that around half of us in the UK continue to receive cheques, our research shows that not many of us are actually aware what happens to a cheque when it is paid into an account.”
According C&CCC research, few consumers understand the 2-4-6 timescales that have been in operation since November 2007, with only 10% of those questioned aware of when they can expect to earn interest on money paid in by cheque (which is no later than two days after paying it in).
Just 23% of cheque recipients were aware of when they can withdraw money (no later than four days for a current account or six days for a savings account).
In related news, payments services association, APACS, recently announced that the UK’s cheque guarantee scheme will end on 30th June 2011.
Agreement has been reached between the 24 banks and building societies that subscribe to the scheme, introduced in the 1960s, meaning that it will no longer be possible to guarantee a cheque using a plastic card after this date.
APACS says that of the 1.4 billion cheques written last year only 7% were guaranteed, representing an annual drop of a third and a fall of 70% over the past five years.
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