A public relations campaign to begin preparing the community for the eventual demise of cheques as a payment instrument got underway yesterday, with the release of a
consultation paper by the Australian Payments Clearing Association.
APCA plans a series of meetings with interested groups over the next two months. It is seeking responses by the end of July.
Reserve Bank of Australia data shows around 270 million cheques were written in the year to March 2011, around half the level of 10 years ago.
The value of cheques written in the last year was A$970 billion, down from $1.6 trillion 10 years ago.
There were 2.5 trillion direct entry payments (which are a proxy for alternative payment methods to cheques) in the 12 months to March 2011, with a value of $11.5 trillion.
Ten years ago there were 1.3 trillion payments made through the direct entry system, with a value of A$5.7 trillion.
The APCA discussion paper provides some data collected from financial institutions. This shows that of personal customers with a cheque account (a number not stated) only 30 per cent had written a cheque in the past 12 months.
Of that group, 48 per cent aged 60 or over wrote a cheque. Of those aged from 18 to 30 only seven per cent wrote a cheque.
The survey also found that most business accounts designated as cheque accounts - itself an archaic banking practice - were no longer used to write cheques.
APCA said that business operating in the property and business services' sector were the most common users of cheques.
Cheque use is also "relatively higher" in dividend and share dealings, property settlement and insurance, and in parts of the legal and accounting professions, APCA said.
However, once common products such as travellers' cheques and warrants have become redundant.
One object of the APCA process is to search for mechanisms to accelerate the reduced use of cheques, such as increasing education about electronic payment options or by otherwise lowering "barriers" to other forms of payment.
This would include extensive reform of business practices and also the law governing property conveyancing, a process underway but likely to take many years to complete.
So entrenched are cheques in real estate transactions that the average value of each cheque written in Australia is rising (to around A$3800) even as cheque use declines.
APCA also cited a 2010 study by Edgar, Dunn & Company over cheque use.
The survey found that 25 per cent of consumers still use cheques to some degree and around five per cent would have a major problem finding an alternative to using cheques as a method of payment.
This latter group were predominantly the elderly, the rurally isolated and the unwaged.