The Payments Council has cancelled its target of abolishing cheques in 2018 and said they will be available "for as long as customers need them".
The Payments Council, the industry body that sets the strategy for UK payment systems, had proposed phasing out cheques by October 2018.
A statement from the Payments Council, released on Tuesday, said: "The Payments Council is today announcing that cheques will continue for as long as customers need them and the target for possible closure of the cheque clearing in 2018 has been cancelled."
Richard North, chair of the Payments Council, who recently appeared before a Treasury Committee on the proposed abolition of cheques, said in the statement the council had concluded that customers should be reassured that the cheque was staying.
"We will use what we’ve learnt to keep improving existing systems, as well as introducing innovation, so that customers benefit from 21st-century ways to pay. Innovation must be at the heart of what we do," he said.
The Treasury Committee was due to publish a report with its recommendations soon, but a spokesman said its contents would need to be reviewed in the light of today’s announcement.
"But I think they will still want to issue a report because there are areas of concern around issues such as whether banks will provide facilities for cheques going forward," he said.
Simon Morrison, director of marketing and communications at the Institute of Fundraising, said the organisation was delighted with the Payments Council’s announcement.
"It will make a world of difference to a lot of our members," he said. "However, we hope this does not mean they will stop working to find a suitable alternative for the next generation – we think there’s a need for a replacement."
Caron Bradshaw, chief executive of the Charity Finance Directors’ Group, said the council’s decision was sensible but she hoped work would continue to develop more secure, cost-effective and efficient forms of payment.