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Contractors need to hold onto their cheques

A recent study shows that a startling amount of cheques are misplaced or lost, costing small business up to £740 per year. In a recent study conducted by Barclays bank, it was discovered that a fifth of small business owners forget to pay in cheques at least once a week, costing them up to £740 […]

By Laura Nixon on 20 Sep 2016
Read time: 2 minutes

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A recent study shows that a startling amount of cheques are misplaced or lost, costing small business up to £740 per year.

In a recent study conducted by Barclays bank, it was discovered that a fifth of small business owners forget to pay in cheques at least once a week, costing them up to £740 on average. This, alongside owners who misplace and never recover their cheques, could mean companies are losing up to £550 million a year. The startling implication here is that, due to these forgotten or missing cheques, an estimated one million traders and small business owners aren’t being paid regularly.

This follows on the heels of a different study conducted by Mintel, that cheques are slowly becoming a thing of the past. In the last three months only a third of the population was found to use the – apparently increasingly outdated – payment method, compared to the 40% in 2015. Combined with the rise of contactless payment, making up 39% of payments the study found, Cheques are now the least favoured method of payment for Brits.

However, the firm also argued that not everybody is okay with the current trend, finding the idea of an entirely cashless system “uncomfortable”. Mintel’s financial analyst Rich Shephard stated “People’s payment habits change slowly, as can be seen with the cheque’s stubborn refusal to disappear from the payment’s landscape.”

Barclay’s own study would appear to agree with the firm’s claim, and as evidence it submitted that more than 90 million cheques were paid into their accounts over the past year, valuing over £140 billion. Of course, that is not to obfuscate the underlying issue, as the study goes on to advise that “the 550 million lost each year by SMEs losing or forgetting to deposit their cheques [only] highlights the scale of the problem.”

Whether cheques – having already survived a remarkable two millennia since their creation in 1st Century Rome – are on the out or not, a little more care may need to be taken when handling and paying them in.

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