Although the future of payments is digital, thanks to contactless and mobile, physical methods like cheques are still remarkably popular. For years, recipients have needed to wait up to five days for their signed piece of paper to clear, but that's all about to change. Thanks to a new image-based processing system implemented by the Cheque and Credit Clearing Company, cheques can now be cleared in a day.
The new process is simple. Instead of taking each cheque and sending it via post to a clearing centre -- which involves a system of checking, verifying and transportation around the country -- the new system allows banks to simply take photos of them and swap the resulting images with other financial institutions. The result is that account holders will be able to withdraw the funds by 23:59 the next weekday (excluding bank holidays).
The Cheque and Credit Clearing Company warns that while the new system went live on October 30th, the volumes of cheques being rapidly processed will be small. It'll continue to operate the new and old systems in parallel, before switching everyone over to faster processing during the summer of 2018.
Cheques will still need to be written and paid in the same way (which includes apps, if your bank supports it), but the money will leave accounts a lot quicker.