When the UK Payments Council announced their decision to phase out cheques by 2018 there was a sense of acceptance and many people across the country thought this day was inevitable. However, after a long drawn out consultation process with government ministers and the public, the Payments Council decided to reverse their decision and announced that cheques are here to stay. The reason? Whilst cheque usage is steadily decreasing, businesses are still heavily dependent on them.
Cheque usage in UK businesses still strong
A report by the Cheque and Credit Clearing Company revealed that over three quarters (76%) of UK businesses still use cheques as a common method of payment. You may be wondering why this is the case considering technological innovations such as PayPal, Barclays Pingit, Sage Pay and debit cards, that offer fast, safe and reliable methods of payment. Whilst there are many reasons, the biggest is cash flow – the lifeline of any business. 36% of UK businesses rely on the delay cheque payments offer to help keep their cash just a few days longer than they would if using alternative forms of payment.
Top Tips for Cheque Protection
If you are a seasoned cheque user or have recently made the decision to continue using cheques then it’s definitely worth learning how to protect yourself from cheque fraud. Whilst movies such as Catch Me If You Can have given the impression that committing cheque fraud is easy, it’s safe to say that with a few simple precautions cheque payments can be just as secure as other forms of payment. Here are a few easy steps to vastly reduce your chances of being a cheque fraud victim:
- This may sound obvious, but don’t leave your cheque book lying around. Keep it locked away where only authorised signatories have access.
- Reconcile your bank statement regularly.
- Try to regularly audit your cheques – this is made far easier if you write cheques in the order they were printed rather than ripping cheques from the middle of the book.
- Purchase cheques containing comprehensive security features that are much less likely to lead to cheque fraud compared to standard bank cheques.
- If you use software to print your cheques, then make sure it doesn’t populate your cheques in a way that there is plenty of room for fraudsters to make amendments to the name or amounts.
- If you issue lots of cheques with a low amount (e.g. refunds) then open a separate account and advise your bank of an upper limit for that account. This will ensure nobody can cash in a large value cheque.
Sage offers unique security
If you are an existing Sage user you will be pleased to know that our new release Sage 50 Accounts 2013 now contains our new and unique ‘Free Text Secure’ cheque layout which ensures cheques printed using this latest Sage software are as secure as possible.
If you’d like to do more to protect yourself from cheque fraud then we would also recommend Sage Cheques, they work easily with Sage 50 Accounts Plus and Professional. They’re perfect if you use lots of cheques and come armed with lots of market leading security features designed specifically to foil fraudsters and keep your money safe. Call 0800 33 66 33 to find out more.
Keith Arkle, Small Business Team