Analyzing Trends Towards Phasing Out Cheques in the Namibian Banking Sector

Abstract

The paper analyzed trends towards phasing out cheques in Namibia using a quantitative approach consisting of time series/trend analysis, mean, tables, graphs and correlation coefficient. Findings show that cheques are falling domestically and globally and are associated with huge drawbacks. Although the correlation coefficient is -0.73 between domestic cheque volume and global cheque volume, global cheques are decreasing. In addition, although the United States is still the dominant user of the cheque payment instrument globally, the usage is declining year-on-year. It is recommended amongst others that the industry can consider further increasing the cost of using a cheque, further reduce the clearing cycle, allowing a depositor to have quick access of funds from a deposited cheque, introducing penalties on cheque float if it takes time to phase out cheques in Namibia.

Keywords: Cheques, Phase Out, Cheque Strategy, National Payment System