The Committee’s report accompanying the publication of the responses focuses on the Payments Council’s decision to re-examine the abolition of the cheque guarantee card as well as the Government’s commitment to bring the Payments Council within the scope of financial regulation
The report concludes that:
"The Payments Council must provide further details of the research it is undertaking on the guarantee card as well as the decision–making process it will undertake once the research is complete.
There is a case for reintroducing either the cheque guarantee card scheme or an alternative mechanism to ensure cheque acceptors have confidence when accepting cheques. Without such a scheme there is a risk that more and more shops and other bodies will refuse to accept cheques; the cheque would wither on the vine. An increasing number of shops and other organisations are refusing to accept cheques as a result of the abolition of the guarantee card. The Government threatened to legislate to preserve cheques prior to the Payments Council’s change of heart. When the Payment Council’s report is to hand, the Government may wish to consider whether intervention on the guarantee card is also warranted."
Bringing the Payments Council within the scope of financial regulation is needed to ensure there is never again a repetition of the cheques debacle. The Payments Council was able to take decisions affecting millions of people at its own initiative without any effective scrutiny by a regulatory body.
The Committee Chairman, Mr Andrew Tyrie MP, said:
“The Government can consider whether intervention on the cheque guarantee card is needed when they have the Payments Council’s report on the guarantee card to hand. The Treasury Committee will monitor the Government’s work on this closely”.
“The Government’s acceptance of our recommendations to bring the Payments Council within the scope of financial regulation is good news for millions of people who want to keep their cheque books. It will also offer consumers some protection against being bounced by the Payments Council into other changes that would disadvantage them”.