The use of cheques continues to decline in South Africa
The use of cheques continues to decline in South Africa as customers move to digital payments, says Kenneth Matlhole from FNB Business.
Financial institutions and most of their customers are increasingly adopting technologically advanced payment alternatives that are far more convenient and cheaper, FNB said.
Matlhole said that cheques convey a written instruction to your bank to pay money from or into your bank account, and due to manual functionality in this process, there are substantial disadvantages that go with this option.
“Over the years, the growing usage of electronic payment methods, high expenses, inefficient processes and vulnerability to fraud have been key contributors to the global decline in cheques usage. In addition, cheques do not offer users the convenience and relative security provided by digital payment solutions.”
Matlhole said South Africa’s migration away from cheques has mainly been driven by customers embracing the convenience of emerging technology. However, he said, there is a role for financial institutions to educate customers about alternative payment methods and their added benefits.
“The universal shift towards digital payments is rapidly emerging across societies and in markets such as the United Kingdom, we’ve seen dedicated working groups tasked with fact-finding around the future of cheques vs digital payments. We are also on the same mission to understand our customers’ needs and how we can help in adopting alternate payment methods,” Matlhole said.
The graph below shows cheques usage figures, as monitored by PASA:
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