Cheques being phased out in Australia by 2030

[jfiresto]

... I only had a cheque once, it was a PITA to cash, my bank wanted a fee because it was issued by a different entity, had to go to the f** end of  the city, get the cash, go back to my bank and deposit it.
To me it's just a messy way to transfer money!

I did not find sending or receiving Eurocheques all that much bother, but then I could expect that any branch of a bank routinely handled them. I wrote my last one just over 22 years ago. They were discontinued three months later, at the start of 2002, at which point everyone just used the guaranteeing Maestro/Eurocheque card purely as a debit card. (It already was one.)

[TimFox]

Is the Australian government phasing out checks due to consumer demand, or demand by the banking industry?

[Bud]

To save trees.

[Halcyon]

I can understand why some businesses would not take plastic.  The fees charge for plastic are high, and profit margins for some businesses are quite low (e.g., 5%).  One local market I go to has a minimum for using plastic for that reason.

Seems to be the opposite case here and many other parts of the world. Increasingly, businesses are starting to refuse cash in favour of electronic payment methods. Transaction fees aren't zero, but they are pretty negligible in the grand scheme of things (and the amount is capped by law).

Even sole traders are able to accept card payments because it's cheap and easy, and doesn't come with all the complications of handling cash. You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

It would be unusual to walk into a shop in Australia where card wasn't accepted. Years ago, a few in my local area tried that and either had their hand forced (through customer domain) or went out of business.

There may be some exceptional edge cases where a business is being transacted simply doesn't have cellular coverage or internet access via some other method, however, I can't say I've ever been to such a place. I've been to some pretty remote towns in Australia where even Telstra (AU's largest telco) coverage is non-existant, and they still have broadband via satellite or the National Broadband Network. It would be highly unusual to go to any town with any kind of population and not have some cellular covarge. Years ago I travelled through a small town called 'Tilpa' in New South Wales. I think it has a population of 40 and the pub is also the petrol station, post office, corner store etc... Even that had 4G/LTE coverage.

[Someone]

Is the Australian government phasing out checks due to consumer demand, or demand by the banking industry?

Likely to simplify their systems (fewer options, less to maintain) so basically just cost saving.

[David_AVD]

I officially stopped accepting cheques about 5 years ago, but in reality I think I only ever saw one or two in the previous 10 years before that.

I'd much rather have the funds in my business account that night even with the 1 - 2 % transaction fee. No worry about going to the bank, will the cheque clear, etc.

I see a mix of American Express, MasterCard, Visa and debit cards and the odd cash payment. Good riddance to cheques I say!

As a consumer I pay with credit card, EFT or cash.

[TimFox]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

[nctnico]

This was something a few of us were discussing over on the EEVblog IRC channel today.

I learned that the Australian government will be phasing out the use of cheques by no later than 2030. Which to me is still quite late considering the use of cheques in Australia is almost zero today.
Most Australian banks haven't offered cheques for most accounts for some time, however they will still process cheques that are sent to them (at least for now).

Last time I used a cheque must have been nearly 30 years ago. I recall buying my first logic analyser using a cheque but that was one of the last things I paid with a cheque. Nowadays I use my phone to transfer money to somebody directly and they can see the transaction entering into their bank account near realtime. No risk of a cheque received from somebody getting declined or forgetting you wrote one and run out of money.

[Bud]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

[nctnico]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

It is that simple (and cheap). You can buy these card readers which connect to a mobile phone app. Prices are as Halcyon indicated.

[bdunham7]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

I don't object to others using them nor is it a problem for me to accept them, but I don't want to be compelled to write them without reasonable security features (that we don't have). 

[Bud]

Last time I used a cheque must have been nearly 30 years ago. I recall buying my first logic analyser using a cheque but that was one of the last things I paid with a cheque. Nowadays I use my phone to transfer money to somebody directly and they can see the transaction entering into their bank account near realtime. No risk of a cheque received from somebody getting declined or forgetting you wrote one and run out of money.

Personal electronic transactions here have limits. To pay big amounts like to replace the roof, do the driveway, instal HVAC equipment, build a fence, etc, it is easier to write a single check then spread payments over several days. Also make contractors happy for same reason.

[Bud]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

It is that simple (and cheap). You can buy these card readers which connect to a mobile phone app. Prices are as Halcyon indicated.

Phones? I have never seen merchants using phones to accept payments. Here everyone is using proper Point-of-Sale terminals. That equipment is regulated by Payment Brands and have payment encryption keys loaded. Not sure what Mikkey Mouse system you guys are using on your phones.

[mikeselectricstuff]

Still use checks for some private contractors like hiring painters / renovaters / yard work / plumber / temp employees.

Have these people not heard of Square & similar services ?

[mikeselectricstuff]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

It is that simple (and cheap). You can buy these card readers which connect to a mobile phone app. Prices are as Halcyon indicated.

Phones? I have never seen merchants using phones to accept payments. Here everyone is using proper Point-of-Sale terminals. That equipment is regulated by Payment Brands and have payment encryption keys loaded. Not sure what Mikkey Mouse system you guys are using on your phones.

The phone app is used with a small box connected via Bluetooth, which provides the NFC and chip reading, and does the security stuff

[themadhippy]

There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

Sum up in the uk  have a no monthly charge option

Phones? I have never seen merchants using phones to accept payments. Here everyone is using proper Point-of-Sale terminals. That equipment is regulated by Payment Brands and have payment encryption keys loaded. Not sure what Mikkey Mouse system you guys are using on your phones.

again the uks sum up uses the merchants phone to contact the mothership,the card reader connects via bluetooth to the phone

[Halcyon]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

Square is just one example. Officeworks (it's like Australia's version of Staples) sell the readers on the shelf. Zero monthly fees and it really is just "that simple". Some major banks also have their own terminals which you can rent if you're processing a larger number of payments. They're usually around the $30/month mark. You can even walk in and buy yourself a proper POS terminal: https://www.officeworks.com.au/shop/officeworks/p/square-register-with-detachable-customer-display-pisqu012, you own the hardware, and again zero on-going fees. You just pay a nominal transaction fee.

Even if you are just a hobbist and you want to accept the odd card payment, there is really nothing stopping you from doing so.

[tggzzz]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

Precisely.

It would be good to hear from those that use cheques, to find their use-cases.

Banks would like to save money by phasing out cheques. Use of cheques is diminishing, therefore the costs are diminishing - and that reason for preventing cheque use doesn't hold water.

Banks should serve their customers, not dictate how the customers have to behave.

[tggzzz]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

I don't object to others using them nor is it a problem for me to accept them, but I don't want to be compelled to write them without reasonable security features (that we don't have).

Surely that is a straw man argument! Nobody is compelling use of cheques; rather the compulsion is to not use cheques.

[Halcyon]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

Precisely.

It would be good to hear from those that use cheques, to find their use-cases.

Banks would like to save money by phasing out cheques. Use of cheques is diminishing, therefore the costs are diminishing - and that reason for preventing cheque use doesn't hold water.

Banks should serve their customers, not dictate how the customers have to behave.

I don't think it's just on the Government/banks. Consumer and business habits dictate this.

There is a reason most businesses these days don't use Telegrams, Telex, or even fax for that matter. How long do you go out of your way to support obsolete methods?

[tggzzz]

You can walk down to a local office supply store, buy a $30 card reader and start accepting card payments in minutes. Card fees are typically under 2%, or capped at some nominal fee like $4 if the transaction is particularly large.

I do not believe it is that simple. There are likely monthly system connection fee. No payment service provider would allow you to jump in that simple.

It is that simple (and cheap). You can buy these card readers which connect to a mobile phone app. Prices are as Halcyon indicated.

Phones? I have never seen merchants using phones to accept payments. Here everyone is using proper Point-of-Sale terminals. That equipment is regulated by Payment Brands and have payment encryption keys loaded. Not sure what Mikkey Mouse system you guys are using on your phones.

Here most street market traders and festival traders use a card reader connected to a cellphone. My daughter sells ice creams that way. There is essentially zero barrier to startups.

I believe this is one of several examples: https://www.zettle.com/gb

[tggzzz]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

Precisely.

It would be good to hear from those that use cheques, to find their use-cases.

Banks would like to save money by phasing out cheques. Use of cheques is diminishing, therefore the costs are diminishing - and that reason for preventing cheque use doesn't hold water.

Banks should serve their customers, not dictate how the customers have to behave.

I don't think it's just on the Government/banks. Consumer and business habits dictate this.

There is a reason most businesses these days don't use Telegrams, Telex, or even fax for that matter. How long do you go out of your way to support obsolete methods?

Since the mechanisms already exist, it isn't "out of your way".

You mention telex. One interesting aspect of telexes is that contracts could be legally enforced if telex comms were used, since the endpoints were rented from trusted third parties. Not so for emails, of course.

You continue to have the mechanisms until all of the use cases can be satisfied by other means. I have indicated a couple of problematic cases.

Backward compatibility is very important. IBM and Microsoft never break backwards compatibility, for sound reasons. There are even some unchanged Win3.1 dialog boxes in Win11!

[SiliconWizard]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

Precisely.

It would be good to hear from those that use cheques, to find their use-cases.

Banks would like to save money by phasing out cheques. Use of cheques is diminishing, therefore the costs are diminishing - and that reason for preventing cheque use doesn't hold water.

Banks should serve their customers, not dictate how the customers have to behave.

I don't think it's just on the Government/banks. Consumer and business habits dictate this
There is a reason most businesses these days don't use Telegrams, Telex, or even fax for that matter. How long do you go out of your way to support obsolete methods?

There are a number of claimed reasons for this move, but it is clearly a strategic governmental plan. It doesn't "just happen".
https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/modernising-payments-infrastructure-phasing-out-cheques

[DimitriP]

Last time I used a cheque must have been nearly 30 years ago. I recall buying my first logic analyser using a cheque but that was one of the last things I paid with a cheque. Nowadays I use my phone to transfer money to somebody directly and they can see the transaction entering into their bank account near realtime. No risk of a cheque received from somebody getting declined or forgetting you wrote one and run out of money.

Personal electronic transactions here have limits. To pay big amounts like to replace the roof, do the driveway, instal HVAC equipment, build a fence, etc, it is easier to write a single check then spread payments over several days. Also make contractors happy for same reason.

Like somone  said earlier ......   2% to 5% of a "big amount" is still a big amount

I always wanted to buy a car and use my card. I got the chance to try it.  Nope. No go. They wanted cash or check. At 11pm at night.
Wrote a check and drove off !
Next time I might try to pay with $1 bills. 

[tggzzz]

Many of the above posters not only do not like or use checks themselves, they want to stop everyone else from using them.

Precisely.

It would be good to hear from those that use cheques, to find their use-cases.

Banks would like to save money by phasing out cheques. Use of cheques is diminishing, therefore the costs are diminishing - and that reason for preventing cheque use doesn't hold water.

Banks should serve their customers, not dictate how the customers have to behave.

I don't think it's just on the Government/banks. Consumer and business habits dictate this
There is a reason most businesses these days don't use Telegrams, Telex, or even fax for that matter. How long do you go out of your way to support obsolete methods?

There are a number of claimed reasons for this move, but it is clearly a strategic governmental plan. It doesn't "just happen".
https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/modernising-payments-infrastructure-phasing-out-cheques

That document states, in all seriousness, "As cheque use declines, the cost of supporting the cheque system will continue to increase". That's bovine excrement, pure and simple.

What's happening is that the government is merely enabling banks' strategic plans.