Many charities and community organisations currently use cheques that must be signed by two trustees as the Charity Commission strongly recommends dual authorisation for all payment transactions. But this form of dual authorisation is often not available for transactions they carry out online or by telephone which means charities are currently restricted in their choice of bank.
The Payments Council, which manages methods of payments in the UK, says it is confident that all the banks and building societies are on track to deliver this service by the end of 2013. The Council recently reiterated the commitment made by its members following the 2011 decision to provide an electronic alternative to dual signatory cheques by the end of 2013. This facility should be made available to any organisation that currently has dual signatory cheque books on its account. The Council is monitoring the progress of members in this area, and have promised to publish information on the services available later this year.
This is welcome news for the charity and not-for-profit sector, who should not have to do anything to sign up and should be offered the new service automatically.
However there is a related concern that this may bring the proposed phasing out of cheques back onto the agenda, potentially impacting charity donations as many charities receive a key element of their donations from the elderly who often prefer to pay by cheque.
For any further information on charity accounting please contact Lesley Malkin
