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| Cheques being phased out in Australia by 2030 |
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| tom66:
--- Quote from: tggzzz on October 13, 2023, 09:55:10 am ---Given how the banks don't pass on base rate increases to savers, I doubt they would pass on (?very small?) savings from phasing out cheques. Me a cynic? Shurely shome mishtake. --- End quote --- Well, you're banking with the wrong people. I get 5% on £5k in savings with a major high street bank and 4.82% on the rest with another provider. And I can get SONIA bonds at 5.15% via Vanguard, the interest on which is tax free. The base rate is 5.25% right now. So to say they aren't passing on the higher interest rate situation is wrong, but you do have to be prepared to shop around. --- Quote from: tggzzz on October 13, 2023, 09:55:10 am --- --- Quote ---Many of the smaller banks around here don't take cheques at all. The larger ones require you to post them in, because there are no branches any more... This is a problem for those without access/ability to use technology for sure. --- End quote --- There are also quite a few (1.2million in 2020 [1]) people without bank accounts at all. I don't know how they would receive electronic payments without a bank account. I presume that they take cheques to high street "cheque cashing" services and probably get less than the cheques face value. Yet another way the poor are screwed by the systems. [1] https://www.ukfinance.org.uk/news-and-insight/blogs/financial-inclusion-and-access-banking-services --- End quote --- The problem with people not having access to banks is more related to being NFA (no fixed address) or having no form of ID. To get a basic bank account in the UK, you need: - A fixed address (which a credit reference agency can find, so other bills need to go there, at least for last 6 months) - Two forms of ID (passport and drivers licence typically) - No previous history of fraud or criminal activity involving money in the last 6 years (CIFAS marker) This is particularly an issue because to rent a place you need a bank account, to get a job you need a bank account, applying for IDs requires money and often a fixed address, so the whole system is kind of self sustaining in terms of homelessness and lack of access to banking. It is a problem a few banks are trying to solve with other charities, for instance HSBC offers a no-fixed-address account with some limited features. But you need a homelessness charity to sponsor you as they are representing you to the bank as trustworthy (not sure there's a cost to them but presumably the deal is they don't send any old sod their way). But cheques really have nothing to do with this problem. If you don't have a bank account you can't accept cheques and while cheque cashing places do exist many of them have similar requirements in terms of ID and they tend to take a steep fee. |
| tggzzz:
--- Quote from: tom66 on October 13, 2023, 10:17:07 am --- --- Quote from: tggzzz on October 13, 2023, 09:55:10 am ---Given how the banks don't pass on base rate increases to savers, I doubt they would pass on (?very small?) savings from phasing out cheques. Me a cynic? Shurely shome mishtake. --- End quote --- Well, you're banking with the wrong people. I get 5% on £5k in savings with a major high street bank and 4.82% on the rest with another provider. And I can get SONIA bonds at 5.15% via Vanguard, the interest on which is tax free. The base rate is 5.25% right now. So to say they aren't passing on the higher interest rate situation is wrong, but you do have to be prepared to shop around. --- End quote --- I see many high street banks advertising high interest rates, but typically on only a very limited amount of money, e.g. monthly savings of £200, or £5 max. NS&I (i.e. the government) withdrew its 6.5% rate yesterday, IIRC because so many people had jumped on it. I've been getting ~10% recently on about half my savings. No, you can't get such accounts any more. Wonder why. --- Quote --- --- Quote from: tggzzz on October 13, 2023, 09:55:10 am --- --- Quote ---Many of the smaller banks around here don't take cheques at all. The larger ones require you to post them in, because there are no branches any more... This is a problem for those without access/ability to use technology for sure. --- End quote --- There are also quite a few (1.2million in 2020 [1]) people without bank accounts at all. I don't know how they would receive electronic payments without a bank account. I presume that they take cheques to high street "cheque cashing" services and probably get less than the cheques face value. Yet another way the poor are screwed by the systems. [1] https://www.ukfinance.org.uk/news-and-insight/blogs/financial-inclusion-and-access-banking-services --- End quote --- The problem with people not having access to banks is more related to being NFA (no fixed address) or having no form of ID. To get a basic bank account in the UK, you need: - A fixed address (which a credit reference agency can find, so other bills need to go there, at least for last 6 months) - Two forms of ID (passport and drivers licence typically) - No previous history of fraud or criminal activity involving money in the last 6 years (CIFAS marker) This is particularly an issue because to rent a place you need a bank account, to get a job you need a bank account, applying for IDs requires money and often a fixed address, so the whole system is kind of self sustaining in terms of homelessness and lack of access to banking. It is a problem a few banks are trying to solve with other charities, for instance HSBC offers a no-fixed-address account with some limited features. But you need a homelessness charity to sponsor you as they are representing you to the bank as trustworthy (not sure there's a cost to them but presumably the deal is they don't send any old sod their way). But cheques really have nothing to do with this problem. If you don't have a bank account you can't accept cheques and while cheque cashing places do exist many of them have similar requirements in terms of ID and they tend to take a steep fee. --- End quote --- It is relevant to the availability of cheque facilities, since no electronic mechanism is available to such people. Yes, it is a vicious circle (almost) without end. The "no ID and no records" is a particular issue for people coming to the UK to work or study. Since Halcyon is convinced cheques are unnecessary, I wonder how Australia gets around such issues. Historically they haven't worried about their Abos. |
| tom66:
--- Quote from: tggzzz on October 13, 2023, 10:38:41 am ---I see many high street banks advertising high interest rates, but typically on only a very limited amount of money, e.g. monthly savings of £200, or £5 max. NS&I (i.e. the government) withdrew its 6.5% rate yesterday, IIRC because so many people had jumped on it. I've been getting ~10% recently on about half my savings. No, you can't get such accounts any more. Wonder why. --- End quote --- MoneySavingExpert's guide is quite good and summarises the best offers right now. Suffice to say if you had half a million quid you'd still be able to get around 5% on it by spreading it across 3-4 banks. Of course, at that level of capital you'd probably have investment management. You're not going to get much better from a bank than the 5.25% that the BoE offers because that's essentially risk-free, the BoE is always going to pay that, so why would they give you more on your money when they have to deal with ordinary consumer headaches (fraud, customer service, marketing etc.) Looks like NS&I offers a fixed 5.7% for 3 year product still, competitive with commercial offerings. But you'd need to lock your cash away for 3 years - not always appealing (edit: and it's taxable.) |
| Halcyon:
--- Quote from: David_AVD on October 13, 2023, 09:30:16 am ---There's been plenty of time for the users of cheques to start using the alternatives such as credit / debit card, direct debit, direct deposit, BPAY, etc. I can't think of a single person I know who's ever mentioned in the last 15 years that they prefer cheques to any of the above. --- End quote --- Whilst this is just a sample size of one, my 93 year old neighbour hasn't been a user of cheques for years. Although she stops short of banking apps on her phone, she still uses internet banking, BPAY etc... to pay bills and transfer money around for three reasons: It's free, it's quick and it doesn't involve her driving anywhere due to limited mobility. Based on my observations, I think older people are more adaptive than we give them credit. It's this current generation of young people who tend to be more stubborn and scream "anxiety" when they have to make some changes in their life. --- Quote from: tggzzz on October 13, 2023, 10:38:41 am ---Since Halcyon is convinced cheques are unnecessary, I wonder how Australia gets around such issues. Historically they haven't worried about their Abos. --- End quote --- They have never been necessary for me. Same goes for the vast majority of the Australian population. What can I say? Feel free to make a counter-argument and give me one situation where cheque payments have no alternative from transferring money from A to B (and I'm not simply talking about consumer choice/stubbornness), then I'll consider changing my mind. As for those who might be homeless, or don't have all the regular ID documents, banks will typically address those on a case-by-case basis. There are mechanisms in-place to assist people who fall into those categories. You can read all about it over on Austrac's website: https://www.austrac.gov.au/business/core-guidance/customer-identification-and-verification/assisting-customers-who-dont-have-standard-forms-identification |
| tggzzz:
--- Quote from: Halcyon on October 14, 2023, 12:33:08 am --- --- Quote from: tggzzz on October 13, 2023, 10:38:41 am ---Since Halcyon is convinced cheques are unnecessary, I wonder how Australia gets around such issues. Historically they haven't worried about their Abos. --- End quote --- They have never been necessary for me. Same goes for the vast majority of the Australian population. What can I say? Feel free to make a counter-argument and give me one situation where cheque payments have no alternative from transferring money from A to B (and I'm not simply talking about consumer choice/stubbornness), then I'll consider changing my mind. --- End quote --- The old "I'm alright Jack" and "the small minority can sod off" attitude. Morally and ethically repugnant. 3% of adults in the UK don't have a bank account for one reason or another. How can they receive (or make) electronic payments? How many adults in Australia? --- Quote ---As for those who might be homeless, or don't have all the regular ID documents, banks will typically address those on a case-by-case basis. There are mechanisms in-place to assist people who fall into those categories. You can read all about it over on Austrac's website: https://www.austrac.gov.au/business/core-guidance/customer-identification-and-verification/assisting-customers-who-dont-have-standard-forms-identification --- End quote --- Those are merely a fig leaf enabling the government to absolve itself of responsibility. The "encouragements" (to use the word in the document) are not requirements. As such they are will be severely compromised by * automated and manual systems designed only for the common easy case * poorly trained staff not knowing about how to deal with special cases * individual staff unwilling to become responsible for making a decision that turns out to have been wrong * banks that are being extra-vigilent about identification because they have previously been penalised for contravening money-laundering or anti-terrorism legislation (think HSBC)If you think those points aren't valid, then I'll point you to how poorly (to put it mildly) the UK banks deal with LPAs. Limited Powers of Attorney are the mechanism by "donors" specify trusted third parties who can operate bank accounts for the donor's benefit when the donor cannot. (Memo to self: set up an LPA stating my daughter is my attorney). So, how can those without a bank account receive benefits etc? |
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