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Last Updated: Thursday, 14 February 2008, 14:20 GMT
Decline of the cheque accelerates
A cheque being signed
Cheques are going out of fashion at a rapid rate
The decline in the popularity of cheques speeded up in 2007, according to banking industry data.

The Association of Payment Clearing Services (Apacs) said the number of cheques used last year dropped by 9% to 1.6 billion.

Apacs said that was the fastest rate of decline recorded since cheque use started falling in 1991.

In 2007 more retailers stopped accepting them, with Tesco and Marks and Spencer about to phase them out.

The decline of cheque use, and their eclipse by debit cards for many payments and cash withdrawals, is a well established trend.

Also, many utility companies have increasingly been trying to dissuade their customers from paying their bills by cheque.

Gas, electricity and telecom companies give customers a discount for paying by direct debit, a stance criticised as punishing those who still prefer to use cheques.

Credit card debt

More recently, people have also become more cautious about spending on credit cards.

The amount of money left outstanding on them shot up during the decade and reached a peak in 2005, at an average of 57.4bn left unpaid each month.

Since then card users have taken heed of warnings from the authorities, such as the Bank of England, about the dangers of having too much debt, and have been paying off more money on credit cards than they have been accumulating.

Last year the average monthly amount outstanding on UK credit cards had gone down to 54.2bn.

However, the accumulation of debt on credit cards started to pick up as the year wore on, and jumped in December 2007 to leave 56bn on cards, the highest level for 18 months.

The proportion of new borrowing being repaid was 96% in 2007, far higher than the 87% repayment ratio seen in the year 2000 when the UK's borrowing binge was getting underway.

Between the first quarter of 2000 and the end of 2005 the amount of money outstanding on credit cards rose by 80%.

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