Ready or Not, Here It Comes: Goodbye, Checks
Feb 18, 2011
Who uses checks anymore?? Believe it or not, there are still plenty of people in America that actually do!
Like the post office, checks served an obvious purpose when they were first conceived: they were developed as a convenient way to make payments without being forced to carry around large amounts of gold and silver. Clearly, that’s no longer an issue in this country! When’s the last time you had a hard time figuring out how you were going to get all your gold and silver to the store? Sound ridiculous? It is!!
Checks have been around since at least the ninth century. Check usage, which peaked in the early 90’s, is declining quickly because of electronic payment systems, online transactions and, of course, plastic cards and ATM’s. According to a Federal Reserve study, more than three-quarters of all US noncash payments in 2009 were made electronically, a 9.3 percent annual increase since the last study in 2007. Since 2006, the number of checks paid decreased by about 6 billion (7.2 percent) per year; the number of checks written decreased by 5.7 billion (6.1 percent) per year.
Not only are fewer and fewer people using checks, but it also costs our financial system billions of dollars a year to process checks. Billions of dollars!! Checks are extremely costly for banks to process when compared to electronic transactions. The check collection process itself has become increasingly electronic in past years. Given that fact, wouldn’t it make more sense to just go ahead and get rid of checks completely? Cut out the middle step??
The US is one of the only major international players out there that hasn’t caught on yet. Many countries have either already phased out checks entirely or are in the process of doing it.
The death of the check goes hand-in-hand with the death of the post office. If everyone paid their bills online instead of sending and receiving them by regular mail, there would no longer be a need for the post office. And if everyone paid their bills online instead of by paper check, there would no longer be a need for checks!
I said it in my last post, and I’ll say it again: these changes are already taking place, whether we like it or not. Instead of turning a blind eye, let’s try to figure out how we’re going to adapt. Because ready or not, here it comes!
Next up: bye-bye, books!!
LINKS:
You Sleep When You Die – Ready or Not, Here It Comes: Goodbye, Post Office
Wikipedia – Cheque
iMarketNews – Fed Text: Paper Checks Continue to Give Way to Credit Cards
I’m in the financial industry and this is so true. With the recent and pending regulation changes, bank income is being squeezed like never before. It’s no longer cost effective for banks to process checks and I see a day when there will be a charge for checks — sooner rather than later. E-banking including e-payments, statements, etc is the future and it will be dictated by costs, not necessarily by consumer acceptance.
A progressive thought JZ, but as of last July,
only 52% of the U.S. population had Internet access.
Maybe you need to work on the telecommunications industry first, to lower their rates, in order to make it more affordable for the masses, before you take away Grandma’s Social Security check, that she deposits each month in her bank accoutnt, because she doesn’t trust Direct Deposit.
~ S
I’ve just designed some new digital checks. I think you’re going to like them
You delivered Jordan Zimmerman, another great post, as you promised.
Yes, bank checks are almost history, as they well should be. You overlooked mentioning, bank checks, once issued, already exist only for a brief moment, much like a rainbow.
The first bank, company, or even individual (JP Morgan Chase has an “app” to scan checks with your smartphone for deposit) handling a check converts it into a digital transaction, destroying the actual check. It’s been several years since checks were returned to individuals, or companies, instead, we now receive digital images.
You also forgot to mention, e-banking is far more secure and less susceptible to forgery than check writing.
It all sounds like a win-win situation to me and change will likely arrive far more quickly in the financial world than at the Post Office.
Sunrise, sunset.
Things come and go. If it does not have a purpose it should go away! The stamp. The check. The book. The VCR.
Say goodbye to the antiquated and hello to new. Electronic payment. eReaders. Twitter payments. DVRs.
I am sure direct mail companies will love this direction…okay, maybe not!