FNB to discontinue cheque issuance from January 2021
DURBAN - FNB has announced that it will be discontinuing the issuing of cheques by 01 January 2021.
Customers who still use cheques have been given a six months’ notice period to adapt to alternative forms of payments.
This decision follows 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.
Kenneth Matlhole, FNB Business Product Head said that, as of 1 January 2021, FNB clients will no longer be able to issue cheques. However, the bank will still honour other banks cheque payments until further notice.
Matlhole said, "South Africa has seen an annual decrease of 30 percent in cheque usage, making cheques contributing less than 0.1 percent of the total payments ecosystem in South Africa. During level 5 lockdown, volumes decreased by 80 percent and we have seen businesses continue to adapt to more digital and secure options of transacting".
FNB has taken the following steps as a phased approach to exit cheques as a payment instrument:
Other countries and some financial service providers in South Africa have already moved away from cheques as they are an inefficient, costly form of payment and have become more susceptible to higher levels of risk.
"The decision to exit cheques has been done with great consideration to ensure that we offer payment alternatives for our customers who have been using cheques. We will continue to work with our customers to ensure a smooth transition to payment alternatives that are more secure, efficient and cost effective than cheques," concluded Matlhole
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