....is, that cheques COULD be cleared in 24 hours or even less, but then the banks would not get to use that money during the 7 day period that "clearing" time gives them. So, with this income source cut off, banks would have to charge more for their services....
Choose: free, slower cheque processing or fast, paid for processing.
And yes, you can choose... you can usually pay for express clearance on a cheque if you really want/need it.
The REAL scandal is that CASH also has a "clearing" period. Deposit 100 quid over the counter at your own branch then marvel at the 3 days or more that it takes to actually hit your account.
Here in NZ:
1. Most stores (afaict) don't accept cheques
2. A cheque from a recognised institution deposited over the counter can optionally be express cleared for no charge (e.g. if you get a refund cheque from your power company)
3. Cash deposited over the counter appears INSTANTLY in your a/c - you can deposit cash over the counter then immediately withdraw it via the cashpoint. If you wanted to.
4. EFT-POS transactions (Electronic Fund Transfer at Point Of Sale - is a card+PIN based payment, but is NOT a credit/debit card) appear INSTANTLY on your account. You can go out shopping, then come home and check to see how much money you actually have left in your A/C via online banking.
Guess what.... "free banking" is yet to become the norm, let alone even widespread, here in NZ, and I'm not sure that all banks even offer it - most accounts have a tarif scheme, either monthly flat rate or per transaction charges.
UK has free, low quality banking.
NZ has paid for, much better quality banking.
Which just goes to show, "Free" always costs _something_.