The writing is on the wall for the old-fashioned cheque.

Latest figures show Kiwi cheque use is dropping like a stone - today we write just half as many cheques as we did in 2002. We write about 110 million cheques a year, down from 206 million back in 2002.

We increasingly prefer to zap an Eftpos or credit card, pay online or set up automatic payments and direct debits. And while cash is no longer king, we still visit an ATM twice as frequently as we write cheques.

The latest figures from Payments NZ, which governs bank payments, show Kiwis wrote 13 per cent fewer cheques in 2010 than in the previous year. The decline of cheque use is increasing exponentially.


That fast fall was an international trend, said Payments NZ chief executive Steve Nichols. Cheques are now rare in Germany, Holland and Scandinavia. But in larger countries such as the United States, which has a complex banking system, cheques and cash are still popular.

Banks would like to see the death of the costly cheque but a so-called "grannies' rebellion" has stymied plans by United Kingdom authorities to phase out British cheques by 2018.

Most Kiwis are leaving their chequebooks to gather dust, replacing them with electronic payments. "New Zealanders are the biggest users of electronic payments in the world," Nichols said.

Eftpos transactions alone were 1.3 billion a year. The elderly, charities, some small businesses and government departments appeared to find cheques more useful than most.

But there were no plans, as yet, to kill the cheque in New Zealand. "Change never happens suddenly. There will be much public discussion before they go," said Kiwibank's communications manager, Bruce Thompson. Their demise would be "partly driven by banks, but partly by retailers and Joe Consumer", he said.

Other banks approached were coy to comment though BNZ was waiting for a Payments NZ study on cheques, due next year.

Pam Glaser, chief executive of Crackerjack Promotions, manages events such as the Farmers Santa Parade in Auckland and St Patrick's Day celebrations. She said she could get through a couple of chequebooks in a busy month.

Security was largely why Glaser stuck to the tried and true. The Santa Parade was protected by a trust. Two signatures on a cheque were required to safeguard against fraud.


"Good governance and auditors demand two signatures these days," she said. "With internet banking, [one] person has total control."

She conceded there were probably safe electronic options. "We'll adapt. I'm sure in a few years we will have changed our system."

Kiwi charities processed several hundred million dollars worth of cheques every year. Forty per cent of charitable giving was by direct mail, mostly cheques, said James Austin, executive director of the Fundraising Institute. The problem was that older folk - among the biggest supporters of charities - were reluctant to switch to electronic payments.

"If you're 87 and you've been writing cheques for years, you're not going to change," Austin said.

There was a slow movement towards credit cards - charities must, by law, follow strict procedures of destroying donors' credit-card details, to guard against theft. The larger charities were trying to get people to set up automatic payments or use electronic banking.

Senior citizens' advocacy group Grey Power was opposed to phasing out cheques "for the time being," said national president Roy Reid. He used cheques and Eftpos himself but eschewed internet banking.

"The majority of our people are frightened of the damned things and are wary of using them for finance," he said.