A new initiative, which aims to save the Irish economy €1 billion annually by increasing the use of electronic forms of payment such as debit cards and electronic banking, was launched today.

The Central Bank says the National Payments Plan has a target of doubling the number of electronic payments from 2011 to 2015.

The bank notes that Ireland has the second highest usage of cheques among major European countries, the highest ATM withdrawal rate per capita, while half of all social welfare payment are still paid out in cash.

The recommendations in the plan include the setting of a date next year at which time the public sector will no longer write or accept cheques to/from business users, the modernisation of social welfare payments, and increasing the dispensing of €10 notes in ATMs.

Recommendations also include a review of the national cash cycle, which will include a ''rounding trial'' which could reduce the use of one and two cent coins, while the Central Bank says that the fees consumers and merchants use for payments should be set to incentivise them to use the most efficient forms of payment.

''This plan is not about closing down options for consumers and businesses, but expanding them,'' commented Tony Grimes, the chairman of the National Payments Plan.

' Our vision is for a society where modern forms of payment will be universally accepted, and be the preferred payment choice for most. However cash will remain a widely used method of payment, while cheques continue to be available for those consumers who want to use them,'' he added.

The National Payments Plan Steering committee, the Departments of Finance and Social Protection, the National Consumer Agency, IBEC, the Central Bank, RGDATA, the Irish Payments Services Organisation, AIB, Bank of Ireland and Electric Ireland, oversaw the development of the plan.

The Central Bank's Stefan Gerlach said that operating an excessively paper-based payment system is like imposing an unnecessary tax on the economy

''Ireland can and should be a leader in the payments area - Ireland has the youngest population in Europe and has shown itself to be a very fast adopter of new technology,'' he added.