Skip to main content

South Africa officially ditches cheques

| Legislation

The South African Reserve Bank (SARB), Financial Sector Conduct Authority (FSCA), Payments Association of South Africa (PASA) and the Banking Association South Africa (BASA) have jointly agreed that that the issuing and the acceptance/collection of cheques will cease from 31 December 2020.

The Reserve Bank said this decision was taken due to the numerous challenges associated with the usage of cheques.

It said that these challenges include:

  • A lengthy processing period;
  • Fraud perpetrated through the issuing of cheques;
  • Cheques as an expensive payment instrument;
  • The restricted acceptance of cheques;
  • Declining usage;
  • Limited education and protection for the consumer;
  • Ageing interbank cheque processing infrastructure;
  • Impact of the coronavirus pandemic (Covid-19) outbreak.

“In this regard, South African banks will not accept any cheques for deposit or encashment after 31 December 2020,” the Reserve Bank said.

“Banks are expected to extensively communicate with their clients leading up to and beyond the discontinuation of cheques. Furthermore, to educate their clients on alternative electronic payment methods that may be used.”

The SARB said that affected stakeholders are requested not to write/draw or accept cheques after 31 December 2020.

“They are encouraged to approach their banks to be offered alternative electronic payment methods or to direct any queries they may have related to the process of termination of the usage of cheques,” it said.

You can read more about the phasing out of cheques from the national payment system in the SARB’s consultation paper here.

 


Related Articles

Spar director fined R1 million after refusing n...

By: Brenda Masilela - IOL The Johannesburg Labour Court has fined Spar director R1 million after he refused on more than one occasion to reinstate a worker who was unfairly dismissed.

SARS wants to change VAT collection in South Af...

The South African Revenue Service (SARS) has published a discussion paper on ways to modernise the VAT collection process.

Pick n Pay: Retailer must compensate Springbok ...

by Ahmed Areff – News24 Pick n Pay has been found liable by the Western Cape High Court for damages claimed by Maria Williams, wife of the late Springbok winger Chester Williams, who was injured after slipping and falling at one of its supermarkets.

Massive shake-up for shopping malls in South Af...

Over 2,000 shopping malls and retail centres in South Africa are in for a major shake-up as retail group Spar joins Pick n Pay and Shoprite in bringing an end to long-term exclusive lease agreements.

New rules for sharing content on WhatsApp, Face...

The Film and Publications Board (FPB) has published three new documents that serve as industry codes and guidelines on how to handle “harmful content” on various online platforms and peer-to-peer networks in South Africa.