On 5 December 2024, the Monetary Authority of Singapore and the Association of Banks in Singapore have jointly announced updates to Singapore’s payment landscape. The Monetary Authority of Singapore has released a consultation paper detailing these initiatives and seeking stakeholder feedback. Two new electronic payment solutions—Electronic Deferred Payment and its enhanced version—will be launched by mid-2025 to facilitate the transition to e-payments for businesses and individuals. Furthermore, the cessation deadline for processing corporate cheques has been extended by one year to 31 December 2026.
The Electronic Deferred Payment and EDP+ solutions are designed to replace traditional post-dated cheques and cashier’s orders, providing users with seamless digital alternatives through existing digital banking platforms. These solutions replicate the functionality of cheques while offering enhanced security and efficiency. Starting from 1 July 2025, Singapore banks will cease issuing new corporate cheque books, and corporate cheque processing will end by 31 December 2026. Retail cheques and cashier’s orders will remain available, ensuring a gradual and inclusive transition for users. USD-denominated cheques will also continue to be supported, with plans to introduce CTS Lite, a cost-efficient cheque processing system, in 2027. This new cloud-based system will replace the existing Cheque Truncation System to manage reduced cheque volumes while minimising operational costs.
The consultation paper issued by the Monetary Authority of Singapore outlines a roadmap for phasing out corporate cheques while ensuring a smooth and inclusive transition to electronic payment systems. The paper outlines the launch of Electronic Deferred Payment and EDP+ as substitutes for cheques, the introduction of CTS Lite, and strategies for assisting sectors heavily reliant on cheques. Additionally, the consultation paper provides guidance for senior citizens, who will continue to benefit from waived cheque processing fees, and outlines measures to make retail cheque services affordable for users.
Key highlights of the paper include:
- Introduction of New Payment Solutions: The Electronic Deferred Payment (EDP) and EDP+ systems will replace post-dated cheques and cashier’s orders. Designed to replicate cheque functionality, these solutions offer enhanced digital features like real-time notifications and secure payment guarantees. Both systems will be accessible via existing banking platforms and are set to launch by mid-2025.
- Timeline for Phasing Out Corporate Cheques: The issuance of new corporate cheque books will cease on 1 July 2025, with cheque processing for corporate users extended until 31 December 2026. This extension provides businesses additional time to transition to digital payment alternatives.
- Continued Support for Retail and USD Cheques: Retail cheques and cashier’s orders will remain available for individuals, and USD-denominated cheques will continue to be processed under a new system, CTS Lite. CTS Lite, a cost-efficient cloud-based cheque processing system, is scheduled for implementation in early 2027, replacing the current Cheque Truncation System.
- Public Education and Communication Campaigns: The banking industry, supported by the Monetary Authority of Singapore, will conduct outreach efforts to educate users on alternative payment methods. Particular focus will be placed on sectors heavily reliant on cheques and individuals less familiar with digital banking.
- Legal and Operational Considerations: The consultation explores whether additional legal frameworks are required to support the adoption of EDP and EDP+. Existing laws governing cheque transactions will not apply to these new solutions. Feedback is sought on how businesses can address failed or cancelled payments under the new systems.
- Inclusive Measures for Senior Citizens: Banks will continue waiving cheque processing fees for seniors aged 60 and above as of 31 December 2025, recognising their need for extended support in transitioning to e-payments.
Stakeholders are invited to submit their responses and feedback on the consultation paper by 17 January 2025, either via the designated portal or email provided in the paper
(Source: https://www.mas.gov.sg/-/media/mas-media-library/publications/consultations/ftig/2024/consultation-paper-on-roadmap-to-sunset-corporate-cheques-and-transition-plan-for-retail-cheques.pdf, https://www.mas.gov.sg/news/media-releases/2024/mas-and-abs-announce-launch-of-edp-solutions-in-mid-2025)
