Kiwibank to cease cheque acceptance by Q1 2020
(14 May 2019 - New Zealand) Kiwibank will stop accepting cheques by February 2020 and will cease issuing new cheque or deposit books after Q3 2019.
Cheque usage in New Zealand has been trending steeply lower over the last decade. Payments New Zealand figures show there were 120 electronic payments for every cheque written last year compared to 2010 where there were only 18 electronic payments for every cheque.
In early 2019 major retailer The Warehouse also stopped accepting cheques. Those that used cheques more than five times over the past year would be receiving personal letters advising them of the change. A spokeswoman for state-owned Kiwibank said of its one million customers only 5,400 were writing more than one cheque a month. She confirmed that the bank realised that people who used cheques might take the decision badly. Asked if the bank could lose customers as a result of the change the Kiwibank spokeswoman said: "Customers have a choice but our preference would be to prepare people for the change."
Last month Kiwibank partnered with Digital Inclusion Alliance Aotearoa and was supporting Stepping UP, an initiative that provides free, community-based training that works to build digital skills and knowledge in communities.
Kiwibank CEO Steve Jurkovich said it was a tough decision to make but for the past five years the use of cheques had been steadily declining. "With less than one per cent of Kiwibank payments now made by cheque, we've come to a tipping point. We've chosen not to invest in a shrinking service and outdated technology, instead we're moving forward and equipping customers for a world that is increasingly digital," he said.
"Online tools can offer a more convenient and cheaper customer experience, but there can be barriers to usage. This new partnership is about making sure all Kiwis have the same opportunity to build their online skills, feel more included and gain confidence. It will also mean they have access to cheaper and faster financial products and be confident they are doing so securely" he added.
"KiwiBank has taken the plunge many other banks I'm sure have considered or would like to do but didn't want rock the boat with what could be seen as another negative. Providing a digital platform that is easy to use and hopefully more cost effective for the end customer has to be welcomed" said David Boyle, a finance industry commentator and former head of education at the Commission for Financial Capability. He added that it was inevitable that the days of the cheque book were numbered but contended that he was concerned how older New Zealanders in particular were helped with the transition especially if they don't have access to the internet or a smart phone.
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