Hacker News Reader

Comment by robocat | Hacker News Reader

For the moment.

New Zealand doesn't have cheques any more. Banks here totally phased them out a couple of years back.

The USA will also make checks obsolete over time.

Plus cash is disliked at many retailers and cash is not acceptable at some locations (e.g. my skifield only accepts cards - I was told it is because the nearest small-town bank won't accept cash deposits from the skifield). I suspect our government will slowly discourage cash 1. to prevent tax evasion (cash jobs), and 2. to prevent illegal purchases (e.g. weed). Those are the main uses for cash that I personally see others use cash for (I use cash because I like using it and I like privacy).

View on HN

I wouldn’t necessarily expect us to follow New Zealand’s example. We’ve accumulated a lot of methods for exchanging money without really discarding any in particular.

New Zealand is a small country way out in the middle of the South Pacific Ocean 2.5K miles (or over 4K kilometers) away from its nearest neighbor and with a population smaller than NYC. The United States is 50 stubborn ass States plus the Fed’s occupation in southern Maryland. The Reserve Bank of New Zealand has an address in Wellington, is owned by the New Zealand government and answerable to Parliament. The Federal Reserve system isn’t even a single bank with a single board of directors, isn’t wholly owned by the US Government and isn’t directly answerable to Congress.

There’s no easy way to make a lazy comparison between us and have it be convincing. Parts of the Federal Government would likely love to see the United States become a cashless society but they don’t always get what they want.

> with a population smaller than NYC

Australia has a population bigger than NYC and "Australia is set to be a cheque-less society by the end of the decade, if the federal government has its way."

Zealand has a population and land area similar to Oregon. Might as well say NZ has a much bigger population than Wyoming - NYC is irrelevant.

Cheques have slowly disappeared because of economic reasons: the transaction costs/risks involved, and because electronic transfers have benefits. The economic forces are likely similar in the states. I believe the change has little to do with the NZ government nor the Reserve Bank of New Zealand.

Kinda missing the forest for the trees here. What I’m driving at is that New Zealand and the United States are not easily comparable and just because New Zealand is doing a thing it does not follow that the United States also shall successfully pursue and accomplish the same policy objectives. Even a straight comparison between Australia and New Zealand is difficult and both their system of government and their banking system are closer in form with each other than with the United States, and there's a lot fewer people in a lot fewer places to just straight up disagree and subvert the efforts and policy objectives of the Federal Government, no matter what they may be. If a Presidential candidate ever did make it a platform issue, you could probably expect his opponents to take the opposite approach.

What the United States lacks is the kind of central control that a Westminster-style of government can exercise, even over cash money and checks, and there are a lot more institutions with some say over the continued prevalence of cash so even as its usage declines it is unlikely to completely disappear even in our lifetimes. Even if Chase stops giving their customers checkbooks, it doesn’t mean M&T will, and even if M&T does, it doesn’t mean there won’t be a bank that makes it a point to offer free checkbooks as a value add to small business owners that want to continue issuing paper checks to their employees. The form money takes here tends to be additive, and it is rare for a system to ever completely disappear. I mean next on the chopping block is probably Zelle followed by ACH of all things now that we have FedNow, and even that’s not necessarily going to happen.

You seem to think that government or federal control is required to phase out cheques. Maybe some legislative roadblocks needed removal (e.g. removing laws forcing companies or departments to accept cheques?).

AFAIK it was economic and convenience forces that caused the disappearance of cheques over a couple of decades. Banks discouraged chequebooks by making the accounts and books expensive. Retailers at most risk of receiving bad cheques started not accepting cheques (e.g. gas stations). Handling fees for cheques. Chequebooks not available to people with credit risk. Businesses stopped paying using cheques - instead they needed a bank account. New Zealanders got more familiar with cards and direct debits, so fewer New Zealanders (individuals and businesses) used cheques.

AFAIK it wasn't a top-down activity in New Zealand. Australia's move seems to be more government based but I would guess Oz is part way down the tracks of discouraging cheques.

The last time I remember handling a cheque in NZ was back in the 2000's (dividend payment). I remember thinking cheques were quaint when I worked in the US in the 90's: we have been slowly discouraging them in NZ for decades.

It is just like how we are not paid in cash at the end of the week no more - systemic change happens slowly.

Reply on news.ycombinator.com