MAS to eliminate corporate cheques by end-2025

25 August 2023

On 28 July 2023, the Monetary Authority of Singapore (“MAS”) announced that all centrally cleared cheques issued by corporates (“corporate cheques”) will be eliminated by end-2025. With the fall in cheque usage in Singapore and consequent increase in the cost of processing each cheque, banks will commence charging for Singapore Dollar (“SGD”)-denominated cheques by 1 November 2023.

This announcement follows a public consultation launched on 2 November 2022 by MAS on a proposed roadmap to terminate the cheque truncation system (“CTS”) and transit all users out of usage of cheques. MAS published its response to the feedback received on 28 July 2023, and noted that the proposals received significant support and useful feedback.

MAS said that it will take the feedback received into account and work with The Association of Banks in Singapore (“ABS”) on the following key measures to facilitate the transition to zero corporate cheques by end-2025:

  • ABS will work with the domestic systemically important banks (“D-SIBs”) to build an electronic deferred payment (“EDP”) solution to allow users to make a deferred payment or issue a cashiers’ order without the need for cheques. The EDP solution will leverage on existing payments solutions like PayNow and GIRO and be ready by 2025.
  • Banks will cease the issuance of new cheque books to all corporates in 2025, after the launch of the EDP solution.
  • D-SIBs in Singapore will commence charges for SGD-denominated cheques issued by both corporates and individuals by 1 November 2023, while other banks will do so by 1 July 2024. Charges for SGD-denominated cheques deposited by corporates and individuals will be implemented in phases. The charges will vary among banks.

Individual cheque users will still be able to use cheques for a period beyond 2025 to provide them with a longer runway to switch to alternative payment methods. MAS will conduct a second public consultation in 2024 to set out the initiatives and timeline to eliminate individual cheques and terminate the CTS.

Reference materials

The following materials are available on the MAS website www.mas.gov.sg: