Industry-wide moves to "put cheques firmly in the 21st century" - with new technology enabling them to clear by the next day - will start in October.
A new system will enable images of cheques to be exchanged between banks and building societies instead of moving paper cheques around the country.
It will slash the length of time it takes a cheque to clear from six working days to the next working day.
The Cheque and Credit Clearing Company (C&CCC), which manages the cheque clearing system, said the new system will go live with some banks and building societies from October 30.
But it will be the second half of 2018 before all UK banks and building societies offer the service.
The exact date for this happening will be announced in due course.
For customers paying in cheques under the new system, it means they will be able to withdraw the funds - and be certain that the cheque will not be returned unpaid - by the end of the next "weekday" after the cheque has been paid in at the latest.
A weekday is defined as Monday to Friday, excluding Bank Holidays.
James Radford, chief executive of C&CCC, said: "These changes will put cheques firmly in the 21st century, delivering real and important benefits for the many individuals, charities and businesses that regularly use cheques."
At present, the cheque clearing process involves paper cheques being transported around the country.
"After paying in a cheque, it takes up to two weekdays before the recipient can earn interest on the money, four weekdays before they can withdraw the cash and six weekdays before the recipient can be certain that it will not be returned unpaid.
The new cheque imaging system means that instead, digital images of cheques can be exchanged between banks and building societies - speeding up the process as cheques will not have to go on a physical journey.
Under the new system, people will still write paper cheques as they do now - and they will also still be able to pay them in over the counter at their local bank if they choose to, where the bank will create an image of the cheque and exchange it electronically.
But if someone receives cheques, instead of going to their bank to pay them in, they may instead want to upload images of them on to their mobile banking app to pay them in.
Corporate and charity customers may also be offered a scanning facility by their bank if they have large numbers of cheques to process.
Despite consumers' increasing appetite for internet and mobile banking, 477 million cheques were still used for payments and to acquire cash across the UK in 2016.
Barclays has already introduced cheque imaging for its customers.
In May 2014, it launched a pilot mobile cheque imaging scheme for customers registered to use Barclays mobile banking.
Barclays said it now has 175,000 customers signed up to use the service and customers can still apply to join the pilot, enabling them to pay in Barclays cheques of up to £500 quickly.
Ashok Vaswani, chief executive of Barclays UK, said: "Cheques are one of the oldest forms of payments and we wholeheartedly welcome this announcement which brings them fully into the digital age."