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Taking payments without cheques is easy : use your phone.
UK banks plan to phase out cheques by 2018. This just reflects the reality that cheques are phasing themselves out : usage is down to 3.8 million per day from 10.9 million a day in 1990. It will leave some small businesses, especially those who travel to clients homes, looking for an easy way to be paid. Necessity is the mother of invention, and one invention that could meet the need is Square.
It runs on an iPhone. Clients swipe their card through a reader that plus into the earphone socket, then sign on-screen with their finger. If they have an account the merchant confirms their ID by looking at a picture. Merchants are protected because the transaction is confirmed within seconds, unlike a cheque that can take days to bounce. They can take payments anywhere their phone can get a signal.
The inventor of this service, Jack Dorsey, has raised $10 million in venture capital. His reputation helps : he is one of the co-founders of Twitter. Of course the service is US based and needs adapting to work with UK chip-and-pin cards. The motivation to do this is the size of the market : 3.8 million cheques per day. Processing each cheque costs the banks around £1. A new service that did the transactions for half that would do very well indeed.