That’s not terribly different from at present. In the UK, cheques are generally paid into personal accounts, rather than cashed directly.
Just to be clear, it’s not the government banning cheques; this is the people that operate the clearance system system deciding it is not economic to continue to operate it as numbers fall.
These days I use very few cheques - almost always debit or credit card - or direct transfer to the other person’s bank account (aahh! the joys of having children at university 
) but there are times when they would be hard to replace. There are a number of small traders who won’t take cards (the banks charge a lot more for this service) but I guess as costs come down this should not be a problem - I think I heard suggestions of payment through a mobile phone! - but I’m not sure what will replace the cheque from Grandpa to the kids tucked into the Christmas card.
Just do what people do now and deposit direct to their account. I know it’s not normal in the US, but in other countries it is a very common means of giving people money.
Seriously, I haven’t written a personal cheque for about fifteen years. The only times I’ve used a cheque is a bank cheque to pay large sums to some organisation.
Not sure about all banks, but my credit union online bill pay doesn’t send the money until the next day. And it may not show up at the business I pay for 2 days.
Well, that’s how it works (in The UK) already. For instance, I’ve just paid some money for a joint gift into a friend’s bank account - I did this online. This morning I paid a bill in Italy, through IBAN - I did this over the phone to my bank. These transactions show up on your internet bank statement just as a cashed cheque would - only instantly.
I also no longer get paper bank statements (by choice).
What I find hard to believe is that the US doesn’t seem to be up to speed on this.
My bank (Lloyds TSB in the UK) will credit another person’s account with my payment within two hours of my online instruction. Compare that with a cheque taking three-four working days.
This is not inherent to online banking, with my bank giro payments will go through the same day if done before 10:00, the next business day if done later.
The same deal with account transfers to other banks, only the cut off is 13:00 instead. When both accounts are in the same bank the transfer is instant.
My online bill pay can send a payment the same day - but they charge me $10 extra for that.
I was told the reason they normally send it the next day was due to US banking regulations. Not sure I believe that based on getting it sent same day for $10.
I think this is an important point to make. The OP / Subject line makes it sound like some Draconian ‘banning’ measure by the Nanny State. This is one instance where the government isn’t driving the change. It’s really a case of the banking/clearance industry working with other agencies, including the government, and saying ‘Look, times are changing, we need to change with them, and we think the time has come for the gradual and timely phasing out of written cheques’.
Very few people will be inconvenienced by this, or care, or even notice.
In fact, I don’t think I’ve ever had cheques that weren’t crossed “A/C Payee”.
Nor me, although I’ve often seen those high street chain porn broker type shops that offer a cheque cashing service (for a fee, obviously). I’ve no idea how it works
What is this thing you call paper cheque? I haven’t seen or used one since mid 80s.
I’ve never seen a paper cheque since the 80’s either, and never really understood the point of them.
Here are a few recent situations when I needed a paper check:
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I bought a hockey ticket from a friend, but I wouldn’t meet up with him to pay him in cash. So I had to send him payment via the mail. Mailing a check to him was the simplest thing.
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My house cleaning service requires me to leave the fee on the dining room table for them to pick up. I don’t feel comfortable leaving over $100 in cash on the table, so I always leave a check for them to pick up.
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A club I belong to has annual dues, and I just got the bill. It’s a small local group which doesn’t take credit cards. A check is the only way to pay the bill.
Now, granted, I do have electronic bill pay through my bank, and it is possible to set all of these up as bill pay accounts. But all that happens in that case is that the bank prints a paper check and sends them to these people. And in any case I don’t think it’s worth the trouble for one-time expenses, such as the hockey ticket.
Will the government give everybody a computer and set the whole country up for WiFi? I still use paper checks regularly. To pay the gardener/snow clearer, to pay my chiropracter (whose receptionist still uses a typewriter (electric) and doesn’t have a fax and to transfer money between bank accounts at different banks (I have three, no one of which provides the same free services). I also use checks to pay my housing bills in Barbados since if I pay with a credit card, I pay a huge currency exchange for my Canadian credit cards. If I pay with a US debit card, they charge twice–one to change from US dollars to Bajan and once to change back since the places I stay actually operate in US dollars. But if I give them a US dollar check, all is well.
Just a guess, but I expect that if the central clearing house stops clearing cheques, folks who still use cheques will face a very large increase in cheque handling fees from their banks, due to the banks having to do a lot more work when handling cheques. That increase in bank fees will be an incentive for people to go electronic and avoid paper.
[off topic]Just curious – can the RBC set up a US dollar account that includes a US dollar debit card, or can it only set up a US dollar account without a US dollar debit card?[/off topic]
I find it odd that people say they have not used a check in over 20 years - is that in the US ? I don’t use many but as noted above in some cases I have to use them. For example some charities I give to only accept checks.
BTW, even now not every business can take a payment via bill pay. I tried to pay a big hospital that way but they would not let me.
Using that line of thinking, I opened a BMO US dollar chequing account for use on a summer long road trip throughout the USA. Often I would stay in national or state parks, and pay by leaving a cheque in the self-serve depositories. All was well and fine, until upon my return to Canada I learned that there was a warrant out for my arrest in southern Colorado. The park attendant at Great Sand Dunes National Monument tried to cash my cheque at a train station, rather than taking it to a bank. After I explained the difference between a bank and a train station, the charges were dropped.
Come to think of it, on that same road trip I tried to use a credit card (Mastercard) to pay for gas at a gas station in the backwoods of Kentucky. The fellow running the station had never processed a credit card payment before, although he had been set up to do so, so I spent a bit under half an hour going through the process and getting my payment made via credit card (we could have gone the cheque route, but what’s a road trip without spending time with locals along the way).
On that trip my debit card was hit and miss. Since then, when travelling in the USA (a truly wonderful place for road trips), I carry enough USD cash to keep me for a couple of days, just out of paranoia.
I’m a Canadian. Some of my clients do not have chequebooks. They live by electronic funds transfer/direct payment, debit card, credit card, and cash. They tell me that when they need to write a cheque, they go to the bank or the post office for a bank draft/money order.
The nice thing about such folks is that I don’t have to worry about a cheque bouncing.