DOHA: Qatar’s payment system is moving towards electronic mode from paper-based instruments such as cheques, a trend which is in sync with advanced economies.

The number of transactions through cheques in the country fell last year while the transactions through electronic mode have increased in 2017, according to the Qatar Central Bank (QCB) data.

The size of the Qatar’s payment system reached approximately QR3.9 trillion in 2017, according to the central bank.

Transactions under QATCH increased by 9.2 percent to QR85.6bn in 2017 while the volume increased by 9.3 percent over the previous year.

QATCH is a secure electronic network system in Qatar, which handles the financial transactions, in Qatari riyals, among the banks within Qatar.

Similarly, SWIFT transactions also increased last year. According to QCB data, SWIFT transactions reached QR3.4 trillion in 2017, recording 0.6 percent rise while their volume grew by 10.1 percent.

Move towards electronic payment system benefits the economy and various stakeholders in the payment system as it reduces cost of transactions and stimulates economy.

“Cost efficiency has been at the forefront of arguments for moving from paper-based to electronic payment instruments. Studies have shown that significant savings can be achieved in the transition from cash and paper-based to electronic payment instruments,” noted World Economic Forum in one of its reports.

The preference for electronic transactions in Qatar was visible by decline in the transactions through cheques.

A total of 4.5 million cheques were processed in 2017. The total value of electronic cheques clearing (ECC) was QR299.2bn in 2017, that showed a fall of 3.9 percent while the volume of such cheques declined by 0.7 percent compared to previous year.

The ECC system processes cheques above QR250,000 on a real-time basis, whereas cheques below the QR250,000 are processed on a net basis by the end of the clearing day.

The value of individual cheques per transaction continued to fell as value of cheque transactions fell by a higher quantum 11.1 percent than the number of cheque transactions 7.4 percent.

Usage of cheques as an instrument for conducting transactions has reduced in Qatar as high value transactions are being conducted through electronic medium.

Even though the number of cheques in the low denomination (below QR250,000) category comprised 96.8 percent of total cheques processed, in value terms, it accounted for 30.9 percent of the total value.

Cheques with value above QR1m comprised 60.1 percent of total cheques, although their volume was only 1.6 percent of the total number of cheques processed. Cheques processed with the high value of above QR10m fell from 22.2 percent in 2016 to 20.9 percent in 2017.