Singapore plans to phase out corporate cheques by the end of 2025, although individuals will still have the option to use them for a limited time afterward. To facilitate this transition, an electronic system will be developed to enable users to make deferred payments or issue cashier’s orders.
The annual volume of cheque transactions in Singapore has decreased by nearly 70%, dropping from 61 million in 2016 to under 19 million in 2022. This decline corresponds with a growing preference for electronic payment methods among both businesses and individuals.
As a result, starting in November, banks will begin imposing charges on both businesses and individuals for Singapore Dollar-denominated cheques due to the rising costs associated with cheque processing. The Monetary Authority of Singapore has tasked banks with establishing an electronic deferred payment system that will utilize existing payment mechanisms like PayNow and Giro as alternatives to post-dated cheques.
This electronic system is expected to launch in 2025, at which point banks will cease issuing new cheque books to corporations. Individuals, however, will retain the ability to use cheques for an unspecified period, with a consultation planned for next year to determine the cutoff date and finalize the closure of the cheque truncation system.