The report by the House of Commons Treasury Committee into The future of cheques was published today, with the Institute of Fundraising indicating that the fundraising sector’s Save the Cheque campaign has had an impact on Government decision makers.

The Committee’s report focuses on the Payments Council’s decision to re-examine the abolition of the cheque guarantee card as well as the Government’s commitment to bring the Payments Council within the scope of financial regulation.

The report concludes that: "The Payments Council must provide further details of the research it is undertaking on the guarantee card as well as the decision–making process it will undertake once the research is complete.

"There is a case for reintroducing either the cheque guarantee card scheme or an alternative mechanism to ensure cheque acceptors have confidence when accepting cheques. Without such a scheme there is a risk that more and more shops and other bodies will refuse to accept cheques; the cheque would wither on the vine.

"An increasing number of shops and other organisations are refusing to accept cheques as a result of the abolition of the guarantee card. The Government threatened to legislate to preserve cheques prior to the Payments Council’s change of heart. When the Payment Council’s report is to hand, the Government may wish to consider whether intervention on the guarantee card is also warranted."

Bringing the Payments Council within the scope of financial regulation is needed to ensure there is never again a repetition of the cheques debacle, said the Committee.

The Payments Council was able to take decisions affecting millions of people at its own initiative without any effective scrutiny by a regulatory body.

The Committee chairman, Andrew Tyrie MP, said: “The government can consider whether intervention on the cheque guarantee card is needed when they have the Payments Council’s report on the guarantee card to hand. The Treasury Committee will monitor the Government’s work on this closely”.

“The Government’s acceptance of our recommendations to bring the Payments Council within the scope of financial regulation is good news for millions of people who want to keep their cheque books.

"It will also offer consumers some protection against being bounced by the Payments Council into other changes that would disadvantage them”.

Institute of Fundraising: campaign has made a lasting impact
The Institute of Fundraising said the fundraising sector’s Save the Cheque campaign has made a lasting impact on Government decision makers.

In a response to coincide with the published report by the House of Commons Treasury Committee into ‘the future of cheques’, the IoF maintains that there is a need to continue to protect the cheque as a method of payment.

Time and money need to be invested to research new alternatives, to stop cheques ‘withering on the vine’ as a payment form.

IoF agrees with the report’s findings that the reintroduction of the cheque guarantee card should be considered; or else an alternative mechanism ought to be found to ensure cheques can still be accepted as a payment form.

Louise Richards, director of policy and campaigns at the Institute of Fundraising, commented: “It was never right for the planned phasing out of the cheque to be allowed to progress so far without taking into account the legitimate concerns of key stakeholders, such as charities and charity donors. This is an issue with many far-reaching implications, which needs careful consideration.

“In order to determine the future of the cheque, an independent regulator ought to be appointed. This body must ensure the right decision is made, which suits all relevant sections of society, and not just the powerful financial institutions.”

CFDG: important there is an alternative mechanism
Jane Tully, CFDG’s head of policy and public affairs, added: "While we understand that there were a number of valid reasons for withdrawing the cheque guarantee card, this has meant there is a significant gap left in user requirements. Many charities making mobile sales, for example, have no secure way of receiving non-cash payments as card terminal hire is simply too expensive.

"If the cheque guarantee card scheme is no longer viable then it is important that there is an alternative mechanism to ensure cheques are accepted with confidence, and we therefore welcome the Payments Council’s decision to revisit this issue.

"We would also stress that for progress to be made in this area it is important that payments methods and existing technology – like mobile card terminals - are made more accessible and affordable. Currently cost is a big barrier preventing charities move away from cheque use."

The full report is available: here

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