Since earliest history, civilisations have used various items as standards of value including shells, whale’s teeth, salt and seeds. In the early days of colonisation in New Zealand nails, blankets, gunpowder and alcohol were commonly used to barter for goods.
The use of paper money was first seen amongst merchants in Europe who carried ‘Bills of Exchange’ or ‘promissory notes’ rather than large quantities of gold or silver. These were viewed as legal documents and it is from these that more modern cheques and bank notes evolved.
The first personalised cheques and the later issuing of ‘cheque books’ occurred in the 1800s. Although, much of New Zealand’s early history is dominated by the need for banknotes and a national shortage of coins, cheques were commonly used to pay large sums of money and wages.
For banks geography remained a limiting factor, cheques required the inspection of specimen signatures and account balances which were held at the account holders bank branch. At the opening of the BNZ Motor Bank in 1955 a news report noted telephones were being used to contact the branches of account holders. This allowed cheques to be cashed on the spot.
The introduction of computers in 1967 was made possible by the creation of account numbers. These 14- digit codes, printed along the edge of cheques, could be read by both individuals and computers. This allowed for overnight account balancing for the first time.
In the mid-1970s ‘Nationwide’ was introduced in response to the geographical barriers already mentioned. This was a basic identification card which allowed customers to withdraw cash from their account at any BNZ branch. These ‘cheque-guarantee’ cards were a popular idea in their time, but were soon phased out with the introduction of new electronic banking methods.
Today cheques continue to be offered as a service although their use is certainly declining. More common payment methods now include EFTPOS and internet banking. Despite predictions of a ‘cashless’ future, banknotes and coins continue to be widely used.