First National Bank today announced that it will be discontinuing the issuing of cheques by 1 January 2021.
Customers who still use cheques have been given a six months’ notice period to adapt to alternative forms of payments.
In a statement, the bank said this decision followed the declining use of cheques locally and globally, coupled with the recent announcement made by the Payments Association of South Africa (PASA) to reduce the maximum value of cheque limits from R500 000 to R50 000 in May this year.
“As of 1 January 2021, FNB clients will no longer be able to issue cheques,” said Kenneth Matlhole, FNB Business Products Head. “However, we will still honour other banks’ cheque payments until further notice.”
Over the years, FNB had encouraged clients to migrate to safer, faster and more cost-effective payment mechanisms such as Electronic Funds Transfer (EFT), mobile payments, online banking and card payments, Matlhole said.
“These forms of transacting are not only safer but are far more advanced and effective means that businesses can use to transact.”
Matlhole said South Africa had seen an annual decrease of 30% in cheque usage, meaning cheques contribute less than 0.1% of the total payments ecosystem in South Africa.
“During level 5 lockdown, volumes decreased by 80% and we have seen businesses continue to adapt to more digital and secure options of transacting.”
