Is society needled for PIN money?

Jan 28 2010 by Iain Laing, The Journal

MONEY, or at least the way we pay for things, is changing rapidly. About 25 years ago, I remember, I was researching and writing about a development which was set to transform our shopping lives, even though it was still only a gleam in the eyes of retailers and bankers.

It was called EFTPoS, which stood for electronic fund transfer at the point of sale. It was the cashless society – and it was on its way.

I wrote the article and then forgot all about it – probably half suspecting that like all those Tomorrow’s World inventions, it would never happen – until the other day when I was fumbling to get Chip to agree with PIN on my debit card.

Then it suddenly hit me. “My God, it’s here – this is EFTPoS.” I foretold its coming and then failed to notice its arrival.

And it has arrived big time; even as early as 1998, debit card usage exceeded cheque transactions across the world.

So, perhaps it was inevitable that cheques, first signed some 350 years ago, should be facing extinction.

The board of the UK Payments Council said they will be phased out by October 2018 if alternatives can be developed. It said the use of cheques as a payment method is in terminal decline but the decision will be reviewed in 2016. This is sad, but probably true.

Cheque payment volumes peaked at 2.4 billion in 1990 and have fallen to 663 million in 2008. Major retailers such as Tesco and Sainsbury no longer accept them and I have a suspicion that before 2018 the banks will stop using them, or at least will make increasingly difficult for their customers to use them.

They will probably take even longer to clear them, thus enjoying interest- free use of the funds for longer.

It is a shame and there are people and institutions which are not happy about it. Cheques are still popular with the elderly and sole traders, small businesses, clubs, charities and schools rely on them.

But the banks, doubtless feeling secure in the public esteem in which they are currently held, will ignore these protests, just as they ignore complaints about automated switchboards or branch closures.

:: Peter Jackson is a freelance journalist and former Journal business editor p.jackson77@btinternet.com