Cheque celebrates 350th birthday

The venerable paper cheque celebrates its 350th birthday next week, although the prospect of the payment method celebrating many more is diminishing.

According to the Cheque and Credit Clearing Company (CCCC), the industry body that manages the cheque clearing system in the UK, the first cheque was made out on 16 February 1659 for £400 by Nicholas van Acker to a Mr Delboe.

Cheque processing automation started in the early 1960s at individual bank level, according to a CCCC spokeswoman, as the take up of bank accounts increased.

It wasn't until 1970 that central processing was automated. Interestingly, a stamp duty of 2p was introduced on every cheque not written out to the bearer which wasn't lifted until 1971, also contributing to the more widespread adoption of cheque payments.

At it's peak in 1990 around £4bn was processed through cheques. This volume has fallen however to about half that value by 2007.

In a report, The Great British Cheque, the CCCC forecasts this will fall to a value of just under £400m by 2017 for personal payments and a similar number for business payments.

In a statement, CCCC MD Angela Thomas said: "Cheques arrived in a year when we were a Commonwealth under Richard Cromwell and Sir Isaac Newton was still at school. But, they are unlikely to be around in even another 50 years time, as we increasingly move to other, more convenient ways to pay."

The decline in cheque usage is not uniform, according to the report. Older people still prefer to use it, with more than 50 per cent of over 65s in the UK still making spontaneous payments by cheque at least once per month. Women write more cheques than men, with more than 40 per cent making at least one cheque payment in a month.

In 2008, the Payments Council published a report tentatively suggesting 2018 as the end date for cheque processing. This has been rejected in favour of determining a date when alternatives to cheque payments are available to those that still rely on them. Subsequently, the Payments Council has decided it will agree on an end date for cheque payments by the end of 2009.