03 May 2023

Usage of bank cheques for transaction purposes would be discontinued at the end of the year as the volume and value of their usage has continued to decline.

Cheques processed during 2022 decreased by 24.1 per cent from 361 000 in 2021 to 274 000 in 2022, while the value of transactions decreased by 23.7 per cent from P9 billion in 2021 to P6.9 billion in 2022.

In an interview with BOPA on Monday, Bank of Botswana communications director, Dr Seamogano Mosanako said this trend reflected the continued adoption and increase in the use of more efficient and convenient alternative electronic payments channels.

Dr Mosanako cited channels such as internet banking, mobile money, and point-of-sale machines at retail outlets, which also involved the use of debit, credit cards and electronic funds transfers (EFTs).

The use of cheques had been less efficient due to waiting time for processing and clearing hence the decision to halt their use, she said.

According to Dr Mosanako, the current cheque processing infrastructure and operating rules in the Botswana payments market facilitate cheque clearing and settlement in two days.

She also underlined that there was a risk of a cheque being dishonoured or returned unpaid for other reasons, citing that from the bank and customer perspective, the use of cheques presented some major challenges.

Dr Mosanako said amidst these challenges, cheques were also prone to fraud such as forgery of account holders’ signatures, and counterfeiting as well as issuing of cheques without sufficient funds in the account.

Long processing period to complete a transaction was another challenge that Dr Mosanako highlighted as part of reasons to discontinue the use of cheques locally.

“The discontinuation of cheques as a means of payment in Botswana, is in recognition of availability of more cost-efficient, safe, secure and convenient digital/electronic payment instruments in the country,” she said.

She said digital/electronic payments were both beneficial for both banks and customers in that they were convenient, faster to process and cost effective.

Dr Mosanako urged members of the public and affected corporations to approach their banks to be offered an alternative electronic payment methods, especially digital/electronic channels. Ends