Alternatives to Cheques

With plans to abolish the use of cheques appearing to gain momentum, many consumer groups are urging that the general populace be educated on alternative means of rending payments.  In the event that cheques are eventually phased out, it would be a good idea for all consumers to acquaint themselves with the other means of making purchases that are in common use today.  This will help make the transition much easier for everyone concerned.

The most obvious alternative is to simply pay in cash.  However, this approach has several drawbacks.  First, it may require the consumer to carry around large amounts of money in order to effectively manage his or her affairs.  This can be extremely dangerous, since it increases the potential of being a victim of a violent crime.  In addition, many companies will not accept payments by mail unless they are in the form of cheques.  While using cash for paying your tab at the local pub is one thing, carrying enough cash to make a major purchase is quite another.

Another alternative is to make use of your debit or credit card to make purchases.  This eliminates the need to carry cash, or to hoard large amounts of cash at home.  With a debit card, the amount of the purchase is deducted directly from your bank account.  With the credit card, you can settle the balance with an electronic payment issued from your bank account to your card provider each month when you receive the statement.

If you want to keep within a tight budget and not accumulate a balance on your credit cards, then consider using a prepaid credit card.  These helpful financial tools allow you to load the card with a specific amount, then deducts your purchases from that amount as they are made.  When there is no more money in the account, the card cannot be used until it is loaded with more money.  This approach helps you avoid bank and credit card fees that would apply otherwise, making it a viable alternative to cheques as well as any other medium of exchange.

Tags: Cheques, credit card