In moves that will bring bank accounts into the modern age, the Government today issued a consultation document to allow electronic clearing of cheques. The consultation also covers proposals for stopping cheques electronically and updating the rules for paid cheques to be recognised as receipts. The reforms will save banks millions in processing costs and provide a better service to their customers. Rules that were sensible at the end of the last century need to be overhauled to take banking into the new millennium. Use of the Deregulation and Contracting Out Act enables us to bring the measures into effect rapidly.
Banking is one of the United Kingdom's key service industries.
It adds millions to the national coffers every year and we must allow for changes in the law to enable banks to keep up with the changes brought about by the electronic revolution. The Government is committed to cutting put red tape and helping business to prosper. I believe these proposals do that. Banks will benefit because the proposed new system will be less cumbersome and will cut out paperwork. Customers will also benefit from a more efficient service.