The abolition of promissory notes and checks

日経新聞によると、３メガバンクは紙の約束手形と小切手の発行を終了する見込みです。3メガバンクが足並みをそろえることで、地方銀行なども今後追随する可能性が高いと考えられます。

【English】

Japan’s three major megabanks（Mitsubishi UFJ Financial Group，Sumitomo Mitsui Financial Group and Mizuho Financial Group）are planning to abolish the issuance of promissory notes and checks.

These traditional financial instruments, which have long served essential financial functions, are increasingly seen as outdated in a rapidly evolving digital economy.

One of the primary concerns with checks and promissory notes is the delay in funds transfer. Due to their paper-based transactions, the settlement of funds takes time.

The costs associated with issuing paper checks and promissory notes are also coniderably high. In addition, the handling, processing, and clearing costs incurred by banks and financial institutions pose further challenges.

Another drawback is the potential for misuse or fraud. Paper checks and promissory notes can be more easily manipulated or forged, increasing a security risk. In today’s increasingly sophisticated financial ecosystem, the risk of such misuse is a growing concern.

As electronic payments become more widespread, the diversification of payment methods offers businesses greater flexibility and efficiency. Digital transactions provide rapid fund transfers and often come with lower processing fees. These modern solutions have less vulnerable to fraud and errors.

However, the transition away from checks and promissory notes is not without its challenges, particularly for SMEs. Many smaller businesses still rely on paper-based transactions. The shift to electronic payments may require investments in new technology, training, and changes in internal processes.

In conclusion, while the abolition of checks and promissory notes represents a significant step toward a more efficient and secure financial system, it also presents challenges, particularly for SMEs.

The future trends of regional financial institutions, such as Shinkin Bank and Chihou Ginkou, with strong ties to SMEs are drawing attention.