Hong Kong banks to study heavy cheque users with eye on phase-out
Work with 10 heavy cheque-using sectors including SMEs, charities and brokers will help identify barriers to electronic payments, HKAB says
The Hong Kong Association of Banks (HKAB) is studying 10 industries that still rely on cheques, aiming to understand their barriers to using electronic payments as it works towards phasing out the paper instruments.
Stockbrokers, charities, estate-management companies, and small and medium-sized enterprises (SMEs) are among the 10 industries that use physical cheques the most, HKAB chairwoman Luanne Lim said in a media briefing on Monday after the association’s final meeting of the year. Other high-usage sectors include law, auditing and insurance.
“The use of cheques has been declining, and is expected to continue to decline at a rate of between 10 to 20 per cent each year,” she said.
The HKAB’s consultant will work with these sectors on the challenges that prevent them from shifting to electronic payments, she said, adding that a report will be released early next year. Other markets such as the UK, Australia and Singapore are also trying to reduce the use of cheques.
Lim unveiled the HKAB’s plan in January “to consult the industry and develop a transition road map for the demise of the cheque”.
The number of cheque payments dropped by 27 per cent to 4.33 million in November, compared with 5.9 million in November 2021, while the value dropped by 22 per cent to HK$468.54 billion per month over the same period. The number of electronic payments using the Faster Payment System more than doubled to 65.21 million per month over the same span, with the value rising three times to HK$600.71 billion per month.
Stockbrokers have started to shift to electronic payments, said Tom Chan Pak-lam, honorary president of the Institute of Securities Dealers.
