It was always envisaged that cheques would eventually disappear from our lives, along with fax machines and floppy discs. In 2009 the Payments Council announced their plans to abolish cheques in 2018, with the rise of online banking, fast payments, contactless payments, mobile payments and alike it was assumed that no one would miss such an archaic means of transaction. However, in 2011 these plans were abandoned due to growing unrest from campaign groups, politicians and businesses. Whilst cheque usage has fallen dramatically, falling by 20% to 272 million cheques in 2019, cheques are still popular with certain groups such as the elderly, charities and small businesses that still find it the best way to manage their payments.
In 2015, HM Treasury introduced legislative measures in the Small Business, Enterprise and Employment Act 2015, amending the Bills of Exchange Act 1882, to allow UK banks and building societies to introduce cheque imaging, an innovation that aims to cut down cheque clearing times from a possible six days to one day by sending a digital image of the cheque for clearing, rather than the paper cheque itself. A full explanation can be found here.
https://www.chequeandcredit.co.uk/cheque-users/businesses/cheque-imaging/about-cheque-imaging
Subsequently in late 2017 we began to see the appearance of mobile banking apps that could scan cheques on a smart phone - a handy feature for those too busy or unable to head to a bank, or perhaps have seen their local branch close down. This was a welcome improvement that will benefit all but unfortunately it also opened up cheque fraud from the serious fraudster who has the time and resources to counterfeit a printed document to anyone with a copy of image editing software.
This has led to the adoption of Image Survivable Feature technology, designed to trap and reject counterfeit, forged and fraudulently altered cheques, including cheque imaging payments. For a custom cheque, this works by taking the variable cheque data - the serial number of the cheque, the sort code and the bank account number, and encrypting it within a unique code printed on the cheque face. The information held in the encrypted code provides validation of the details on the face of the cheque and can greatly help with fraud prevention when the cheque image is scanned and verified within the new Image Clearing System.
Russell Barnard, SG World Product Manager, commented “The bar is already set very high to be an accredited cheque printer, not everyone has been able to adopt the latest security features and we have seen a reduction in the number of viable UK cheque printers. However SG World have a significant customer base of cheque users, including many schools, and we will keep supporting them with a solution they can trust”.