Business BankingCheque Guarantee Scheme Closure

A guaranteed cheque is simply a cheque that is guaranteed up to a certain amount. It has to be signed in front of the person receiving it, who writes the card number on the back of the cheque in accordance with the scheme rules.

How this affects you

If you accept guaranteed cheques

You can still accept cheques, although payment won't be guaranteed. This means that if your customer doesn't have enough money in their account to cover the cheque, it may be returned to you unpaid, for which there is a charge.

There are plenty of alternatives - debit cards, credit cards, charge cards, electronic payments and cash. A lot of businesses already accept plastic card payments. If you don't, and would like to, we're happy to help set this up.

If you write guaranteed cheques

This means that you can continue to write cheques after 30 June 2011, they're just not guaranteed. There are plenty of alternatives - debit cards, credit cards, charge cards, internet and telephone banking, standing orders, Direct Debits, bank transfers and cash.

What happens next

We'll start issuing cards without the Shakespeare logo or cheque card hologram from 1 June 2011, so you might receive one before the scheme actually ends. If not, when your card does expire, or is replaced, we'll send you a new one without the logo or hologram on the back.

Why the Cheque Guarantee Card Scheme is ending

Since guaranteed cheques are being used less and less, the Payments Council decided to close the UK Domestic Cheque Guarantee Card Scheme on 30 June 2011. This affects customers (individuals and businesses) of all banks across the UK. We told you about these changes when we updated our Terms and Conditions which were effective from 25 October 2010 for new customers and from 1 January 2011 for existing customers.

For more information

• Call us on:
  08457 606060

Textphone 18001 0845 712 5563

or speak to a member of the Business Banking team in any branch.

• Alternatives to guaranteed cheques for taking payment for goods and services.

  When the cheque guarantee scheme ends in June this year, you must consider the alternatives for taking payment if you accept guaranteed cheques from your customers today.
  
  The alternatives to guaranteed cheques which will continue to be available from July are:

  
  
  • Card Payments: If your customers want to pay using credit or debit cards, HSBC Merchant Services can help your business to accept card payments either in person, online, by phone, mail order or fax.

  
  

  HSBC Merchant Services LLP is HSBC's preferred strategic partner for card processing in the UK. It is a wholly owned subsidiary of Global Payments Inc and is not part of the HSBC group of companies.

  
  
  • Electronic payment: In some cases, customers will be able to initiate an electronic payment to your bank from their mobile 'phone. More often, customers will wish to initiate an electronic payment from their home or business premises, which means they will not be present to take their goods or services at time of payment. In either case, you will have to supply your bank account details to your customer for them to make the payment and you will need to check payment has been received in your account before releasing the goods or providing the service.
    
    
  • Cheque (not guaranteed): If you accept cheques without a guarantee, there is a risk that these may be returned unpaid. Normally, a cheque cannot be returned unpaid any later than six working days after it was paid in.
    
    
  • Direct Debit: You can accept regular payments from customers by Direct Debit. To do this you will need to set up as a Direct Debit originator. One of our Business Banking team can help you do this.
    
    
  • Cash: You can take cash as an immediate form of payment, but beware of counterfeit notes.