Susan Gordon, Business Reporter

Jamaica's five-year-old Automated Clearing House (ACH) processed cheques with face value totalling $2.3 trillion in the calendar year to November 2007, to surpass the full value of current account transactions in 2006.

The ACH, whose members comprise the Bank of Jamaica and the island's six commercial banks, is operated by JETS but governed by the Jamaica Clearing Bankers Association (JCBA).

Up to the end of November, more than 9.5 million cheques were issued by individuals and companies, valued at $2.296 trillion, according to JETS, the same company that manages the MultiLink system.

In 2006, the number of written cheques for the full year rose above 10.4 million, but their value was lower at $2.291 trillion.

An average of 865,064 cheques valued at $208.7 billion were cleared through the ACH per month, over 11 months, the general manager of JETS, Edmundo Jenez, told Wednesday Business.

Fewer cheques issued

Essentially, fewer cheques were issued but for larger amounts than 2006, when transactions over 12 months averaged $190.97 billion per month.

On the average some 869,077 cheque transactions were processed monthly in that year, Jenez said.

The JETS manager also sought to make the distinction between activity on chequing or current accounts, versus cheques processed, noting that the $2.296 trillion figure quoted did not include the electronic transactions effected through what Jenez described as phase two of the ACH.

That aspect of the clearing-house programme will eventually phase out the issuing of hard copy or paper-based cheques by businesses, which instead will employ software to make payments electronically.

"It allows corporate clients to send direct payments to the bank and insurance companies to debit their customers' account and send it back to the insurance company's bank account," he said, adding that the payments can be made from a desktop computer.

Testing of phase two began in October 2006.

The system has been processing 30,000 to 45,000 transactions per month over its first year of introduction.

Jenez said it was too early to estimate the level of participation.

"Banks are just rolling out the service, so it is difficult to say how many individual companies will use the service," Jenez said.

He said, however, companies would be able to use the facility to make dividend payments, replacing the tens of thousands of cheques they now distribute to investors, as well as generate their payroll using own software.

susan.gordon@gleanerjm.com