Euro-denominated cheques issued by UK banks can be used to pay for certain goods and services in the UK. The British euro cheque clearing system was established in 1999 to coincide with the launch of the euro. Following the closure of CHAPS Euro in 2008 and Bacs Euro in 2010, the euro bulk debit clearing is now the only domestic euro payment system in Great Britain.  

Banks that offer customers euro-denominated cheque services generally do so as part of a UK/euro bank account. These cheques can only be used in the UK and when they are paid into euro bank accounts in Great Britain they are processed through the euro cheque clearing, which is managed by the C&CCC.

Many people are not even aware that euro-denominated cheques issued by UK banks exist and that they can be used to pay for certain goods and services in the UK.  There are several reasons why a customer might choose to operate a euro account.  For example they might be involved in cross-border trade and prefer to manage their exchange risk by holding an account in euros.  Some customers work in the euro-zone and receive their salary in euros. Others own property abroad and find a euro account a good way to manage the various receipts and payments involved without having to convert back and forth from sterling.  Not all customers use cheques on their euro account but those who do give as their reason the fact that cheques are a cheap and convenient way of managing euro receipts and making euro payments.

Euro cheques are used mostly by businesses and the volumes seen are very small. Annual clearing volumes for euro cheques peaked in 2003 at 729,000 and, since then, volumes have declined every year. For up-to-date statistics on the euro cheque clearing please click here.


The euro cheque clearing process

The beneficiary pays the cheque into their bank account at their own bank which then passes it through the euro cheque clearing system to the drawer’s bank which, in turn, debits the funds from the drawer’s account. The 2-4-6 clearing timescales do not apply to euro cheques.

All euro cheques used in the British euro clearing must comply with the design, layout and print requirements of C&CCC Standard 3 - Automated Processing of Vouchers and must be printed by a CPAS-accredited cheque printer. 

Euro cheques are cleared in much the same way as sterling cheques, over a three-day period and they use the same processing equipment and the same exchange centres. However, as with bank giro credits, there is less automation – paper is exchanged, but digital files are not - and the volumes are very small, totalling fewer than a thousand per day.

The C&CCC is the Settlement Service Provider for the euro clearings and SWIFT messaging is used to transmit advice of the multilateral net settlement figures to members' treasury departments. An account at a commercial bank is used for the related settlement payments.