Standard Bank says it will stop the issuing of cheques as of December 2020 following the various limit reductions introduced by the South African Reserve Bank (SARB), the continued reduction of cheque usage during the Covid-19 lockdown period as well as the adoption of digital and cheaper alternatives by its clients.
Head of payment at Standard Bank, Busi Radebe says: “We will align with a coordinated industry phase-out plan in order to help clients transition, especially given the business process changes that will need to take place across all stakeholders. Our clients will have between August to the end of December 2020 to adopt new payment methods.”
Cheque books are seldom seen in society today, with the convenience of contactless cards taking over the payments space. Historically, clients would have been able to pay up to R5 million using a cheque, the bank said.
However, this limit has reduced over time driven by overall usage. The last limit reduction came into effect on 1 May 2020, which now only allows for payments of up to R50, 000, it said.
The process will take on the following phased approach:
· 1 September 2020 – stopping the special presentation and clearance of cheques. All cheques will follow the normal seven business day clearance.
· 1 October 2020 – Issuing of new cheque books will be discontinued.
· 31 December 2020 – Official exit of cheque issuing with no Standard Bank cheques allowed for presentment / deposit post this date.
“We welcome the new change as we journey further into our digital transformation and feel that the approach, we have taken will be seamless and allow us enough time to work with our clients to adopt digital payments methods. A combination of our new and existing payments solutions will enable our cheque clients to transition to digital payments that are more secure and cost effective,” Busi says.