Changes to rules for cheque clearance come into force on 30th November 2007.

From this date any cheques paid into a major UK bank or building society will have cleared within six working days, meaning account holders will not suffer a loss if the cheque subsequently bounces.

Previously, banks could recover money from a customer's account if they discovered the original cheque payment was fraudulent.

People will be able to earn interest on a cheque no later than two working days after they pay it and consumers and businesses will be able to withdraw funds drawn on and deposited into current and basic bank accounts within four working days - Friday if you deposit on Monday.

The changes, known as 2-4-6, will apply to anyone who pays a cheque, banker's draft or building society cheque into a UK current account or basic bank account.

The changes come at a time when the use of cheques is tumbling. Figures from Apacs, the UK payments association, show that shoppers wrote a total of 4.9 million cheques each day in 2006 compared with 5.3 million in 2005 and 11 million in 1990.

A number of retailers no longer accept cheques as a method of payment. Argos, Asda, Boots, WH Smith, Next, Shell, Currys and PC World, all now insist customers pay by debit card, credit card or cash.

In research commissioned by the Cheque and Credit Clearing Company, less than a 25% of cheque users surveyed knew the correct timescales for cheque clearing, and more than half were worried about accepting cheques for fear they may bounce.

Angela Thomas, managing director of the Cheque and Credit Clearing Company, said: 'Although cheque use has fallen over the last few years, cheques remain important for certain customers in certain situations.

'Whether it's a small business or someone selling a car, there are many occasions where cheques still get handed over.

'These changes will really benefit anyone paying in a cheque, offering them certainty and clarity on when the money has cleared and giving real peace of mind.'

Despite the overhaul, Britain’s cheque clearance system will still not match that of some other countries. In Canada most customers can withdraw funds paid in by cheque on the same day and in Australia cheques are cleared within hours.