Cheque cashing is a service widely available in the united kingdom where a bearer of a 3rd party check can get instant cash with ease without experiencing the hassle of conventional banking. Within UK, this industry is regulated by Her Majesty’s Revenue plus Customs (HMRC) as a Money services business and by the Office of reasonable trading (OFT) when money in improve services are provided along with the cheque cashing.
Benefits of a cheque cashing service
Many wonder what benefits are available by cheque cashers in today’s era where high street banks are accessible throughout the country. There are some key reasons and benefits of this service.
Many don’t like to operate a bank account that belongs to them, or in some cases one may find it difficult to open up a conventional high street bank account due to their previous credit history or for not meeting various other conditions. Cheque cashing service could be the only alternative for such people to get their 3rd party cheques cashed.
Access to instant cash. Even people who are already having bank accounts do use this service if they need cash instantly, as generally a high street bank will take as much as 5 working days to cash an unofficial cheque. But a cheque cashing service will provide instant cash, to meet immediate financial needs.
Availability with flexible hours. Typically cheque cashing solutions are open for longer hours compared to high street banks. So one can put into a Cheque cashing service after a working day, and walk home along with hard cash.
Some cheque cashing providers offer cash in advance for certain forms of cheque. This is a convenient way to access money on an emergency.
service is available for anyone needing to encash a 3rd party check provided that they can prove their identity as per regulations. It is widely used among sole traders, SMEs, part time workers and those who undertake small unusual jobs on a regular basis.
How does it function?
The customer can walk into any of the numerous cheque cashers all around the country having a 3rd party cheque drawn in their favour. The cashers will validate customer identity and perform further inspections that are mandated by money laundering regulations. If they are satisfied, they will provide the customer instant cash after deducting the fee from the face value of the cheque. The fee charged will vary from casher to casher and in some instance based on locations. So customer can walk out with ready cash, while the casher will financial institution the cheque for it to be compensated by the drawer of the cheque.
The cheque cashers have to be registered with HMRC as a money Service business and are governed by them for money Laundering Regulations. In UK British Cheque cashers organization (BCCA) is the widely recognised business association for companies providing check cashing and short term loan services. They represent their members in government and regulatory bodies here in the united kingdom and in EU. They also act as an informal regulator of the industry through their constitution and strict code associated with practice.
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Future of this industry
UNITED KINGDOM government had a plan to phase out there cheque as a method of payment by 2018. But in summer of 2011 the Treasury committee reopen the inquiry on future of check in light of public concern on above move. Subsequently in July 2011 the payment council withdrew its plan for the abolition associated with cheques and undertook to maintain the cheque system indefinitely. So this as and industry is secured for the foreseeable future.