Bank of Papua New Guinea has issued a statement to cease private and bank cheques next month.
“From close of business on Friday, 29th of December 2023 private sector cheques, including bank cheques, will not be accepted for payment by commercial banks and financial institutions in PNG. Any private sector cheques and bank cheques presented after 29th December 2023 will not be honoured” BPNG Acting Governor Elizabeth Genia stated.
Hence Bank of Papua New Guinea hereby gives notice to all customers holding onto Bank Cheques issued by commercial banks to present these cheques for payment immediately, or before the end of 2023.
Ms Genia stated that Government cheques will not be affected.
“The National Government is gradually shifting towards electronic payments, but the use of government cheques will not be affected by this decision. Individuals, institutions or companies will still receive government cheques in payment for services provided after 31 December 2023, until a formal announcement is made to stop issuing government cheques.”
She further clarified that “BPNG and the commercial banks confirm that the discontinuing of private sector cheques does not breach any laws or regulations, or infringe upon the rights of individuals or businesses.”
“By embracing modern payment technologies PNG can expand financial inclusion, stimulate economic growth and foster a more robust and resilient financial system,” Ms Genia said.
This move by BPNG has raised series of questions on the floor of Parliament today as East Sepik Governor Allan Bird wants explanation and clarification on this by directing questions without notice to Prime Minister James Marape.
Governor Bird said the decision by BPNG to cease cheques will affect the local people especially farmers who sold their produce.
“What is the main reason for central bank to stop our people from using cheques to trade?”
“What is the justification for it, I thought our biggest problem was the lack of foreign exchange and the central bank should be dealing with that.”
“When they (BPNG) come up with this decision, who did they consult?,” Governor Bird questioned.
Governor Bird noted that BPNG is concerned about Money laundering but pointed out that PNG is not facing issues related with money laundering.
In response, the Prime Minister James Marape said government has no control or direct BPNG but recommend hence they will look at alternatives to resolve this.
Prime Minister said PNG is not ready to do away with the use of cheques.
A proper consultation will be done by the Treasurer Ian Ling Stuckey on this matter.
“I will direct our treasurer to work with the central bank on this matter so our issue of ceasing of cheques will be addressed early,” Prime Minister Marape clarified.
