Monday, April 21, 2008

Ipso puts cheque abolition target on hold

20 April 2008 By Emma Kennedy The Irish Payment Services Organisation (Ipso) is awaiting responses from a national payments advisory group before it proceeds with its target of ending cheque payments by 2016. Pat McLoughlin, chief executive of Ipso, said it had presented a paper considering the future of cheque payments to the national advisory group responsible for the National Payment s Implementation Programme. The advisory group includes representatives from government departments, regulators, the payments industry and business and consumer representatives. McLoughlin said he hoped to have responses within the next two weeks, and would then be in a position to approach the government about devising a national strategy to eradicate cheques. He said the government needed to lead the way, by reducing its own use of cheque payments. In 2006,McLoughlin’s predecessor at Ipso, Stewart MacKinnon, set a deadline of 2010 for scrapping cheques as a means of payment. ‘‘Unless a national plan is established to end cheque payments, the converted will keep talking to themselves and slow progress will be made,” McLoughlin said. Ipso claims that, in terms of using electronic payment methods, Ireland is among the most inefficient countries in Europe and estimates that a reliance on cheques and cash is costing the economy up to €1.4 billion annually. Ireland’s cheque usage is about double that of the EU average, with cheques accounting for more than 75 per cent of all non-cash payments in value terms, according to Ipso. McLoughlin said there had only been a 4 to 5 per cent reduction in cheque usage in 2006, and predicted a similar figure in 2007. He said Ireland looked set to fall further behind the rest of Europe, based on that rate of reduction in cheque usage.

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