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Published on Friday, May 04, 2012
Electronic payments have taken their place, growing in the opposite direction from 1.7 billion automated transactions in 1990 to 6.4 billion in 2010.
Other countries are starting to follow the UK payment industry's lead. Recent activities by Irish, American and French payment authorities indicate a growing global realisation that electronic payments, made via automated services such as online banking or Bacs payment software, are the way forward. Those who migrate to them from paper-based methods such as cheques can expect to save significant amounts of time and money.
The National Irish Bank (NIB) believes that persuading cheque users to pay via electronic payment solutions and cash users to pay by debit card could save Ireland €1 billion; the Comité Consultatif du Secteur Financier (CCSF, part of the Banque de France) has calculated a yearly saving of €2.4 billion if consumers discontinue their use of cheques; and there were around 20 billion more electronic payments made in America in 2009 than 2006, with around 6 billion fewer cheques processed during the same period.
The global shift away from processing cheques makes sense. Cheques waste time, paper and, most importantly, money. When postal costs are added to the money spent paying staff to process cheques and the cashflow damage caused by late cheques, the net effect on business is substantial, and therefore well worth avoiding.