HomeOpinionTech has killed the cheque book

Tech has killed the cheque book

By Jacob Mutisi

ABOUT 96% of Zimbabwe’s transactions are done either through mobile money transfers, online bank transfers or electronic banking systems.

This is why the Reserve Bank of Zimbabwe introduced measures to maintain prices and contain “street” money transfers that were prevalent in Zimbabwe and the shift in consumer habits, with Zimbabweans opting for more convenience and safer digital payments.

With the advent of Zimbabwe’s digital age, cheque books have become obsolete. A person can have a bank cheque account without ever actually having to write a cheque.

Zimbabweans can now transact using the banks credit or debit cards, make payments via online bank transfers, and exchange money through the banks’ own mobile phone apps.

Cheques are one of the oldest recognised payment instruments globally and were once a popular form of payment.

They were the major method of large payments where it was impractical to carry large amounts of cash.

Institutions who used cheques are schools, local municipalities, universities, motor vehicle dealerships, churches, non-governmental organisations, food producers, scrapyard entities and individuals.

The new technologies have humbled the cheque book into forced retirement as new banking technologies have transformed Zimbabwe’s financial services.

The death of the cheque is becoming clearer as the financial services are investing resources into new technologies, such as smartphone applications and tap-and-go cards, which will soon become standard banking practice for many.

In 2009, United Kingdom banks voted to phase out paper cheques and encouraged the use of plastic and electronic payments instead.

The UK completely eliminated the use of cheques in 2018. While in  Ireland 2017 was the cut-off point for cheque books. In October 2020 the Reserve Bank of South Africa announced that the use of cheques would be phased out and set January 31, 2021, as the date which the issuing of cheques would cease and the process being complete by June 30, 2021.

The central banks around the world are now focusing on electronic payments innovation, which is being fuelled by the constant growth of electronic commerce, mobile phones and other devices; and access to the internet, including the introduction of significant digital players such as Amazon, Apple, eBay, Google, Paypal, Takealot, Samsung and the cryptocurrency.

Today’s innovators are not investing any effort on cheque innovations due to lack of interest from fintechs and financial service providers.

Today’s consumers have lost interest in cheque books and the financial service providers are now more focused on allowing mobile phones and other devices to easily access the payment system to effect payments.

  • Mutisi is the CEO of Hansole Investments (Pvt) Ltd and the current chairperson of Zimbabwe Information & Communication Technology, a division of Zimbabwe Institution for Engineers.

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