Blockchain E-Checks

Are you ready for Checks on the Blockchain?

Parts of a cheque based on a UK example
1. drawee, the financial institution where the cheque can be presented for payment
2. payee
3. date of issue
4. amount of currency
5. drawer, the person or entity making the cheque
6. signature of drawer
7. Machine readable routing and account information

A blockchain cheque, or check (American English; see spelling differences), is a mutual credit document that orders a bank to pay a specific amount of tokenized money from a person’s tokenized account holdings to the person or business in whose name the cheque has been issued. The person writing the cheque, known as the drawer, has a transaction banking account (often called a current, cheque, chequing or checking account) where their tokenized money is held. The drawer writes the various details including the monetary amount, date, and a payee on the cheque, and signs it, ordering their bank, known as the drawee, to pay that person or company the amount of money stated.

Definition of a cheque as per The National Provincial Bank circa 1968 was “an unconditional order in writing drawn on a Banker, signed by the drawer, instructing the Banker to pay on demand a sum certain in money to or to the order of a specified person or to Bearer and which does not order any act to be done in addition to the payment of money”.

Although forms of cheques have been in use since ancient times and at least since the 9th century, it was during the 20th century that cheques became a highly popular non-cash method for making payments and the usage of cheques peaked. By the second half of the 20th century, as cheque processing became automated, billions of cheques were issued annually; these volumes peaked in or around the early 1990s. Since then cheque usage has fallen, being partly replaced by electronic payment systems. In an increasing number of countries cheques have either become a marginal payment system or have been completely phased out.

The Online Trading Slip

If you cannot meet face-to-face with the seller to hand over a paper Trading Slip or do not wish to post or fax one, send an online Trading Slip using this form. While this online version has no signature and is therefore not a legal document, the email sent to the seller contains your name and email address, which it gets from the CES database. Before sending an online Trading Slip, check first with the seller if it is acceptable to do so.

Select another Group if the seller is not in your CES exchange. You would do this if the seller is in a remote exchange; otherwise ignore this drop-down list of exchanges.

Select the seller’s name and account number from the Send to: drop-down list. The seller will not appear on the list if he/she does not have an email address.

Fill in the Amount of the transaction, and a Description for the trade.

The seller will receive an automatically-generated email (the Online Trading Slip) which authorises him or her to enter the information into the ‘Enter Transaction’ feature of his or her account. This will debit your account for the amount indicated and credit the seller’s.

You will receive by email the ‘counterfoil’ of the Online Trading Slip; an acknowledgment of sending the Slip. It will contain the same details as on the Online Trading Slip and represents your confirmation of ‘paying’. Store it in an email folder in case there is a dispute with the seller.

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