Traveller's cheque

They can be denominated in one of a number of major world currencies and are preprinted, fixed-amount cheques designed to allow the person signing it to make an unconditional payment to someone else as a result of having paid the issuer for that privilege.

They were generally used by people on holiday in foreign countries instead of cash, as many businesses used to accept traveller's cheques as currency.

The financial institutions issuing traveller's cheques earn income in a number of ways.

Also, as interest rates sharply declined in many developed countries in the late 20th and early 21st centuries, traveller's cheques became much less profitable to issue and thus many issuers scaled back advertising and promoting their use while others stopped selling them altogether.

[2] American Express developed a large-scale international traveller's cheque system in 1891, to supersede the traditional letters of credit.

American Express's introduction of traveller's cheques is traditionally attributed to employee Marcellus Flemming Berry, after company president J. C. Fargo had problems in smaller European cities obtaining funds with a letter of credit.

Between the 1850s and the 1990s, traveller's cheques became one of the main ways that people took money on holiday for use in foreign countries without the risks associated with carrying large amounts of cash.

They also had the advantage of being available in smaller denominations for travelers of more modest means, in an era when the well off tended to carry letters of credit.

Several brands of traveller's cheques have been marketed; the most familiar of those were Thomas Cook Group, Bank of America and American Express.

The purchaser of a supply of traveller's cheques effectively gives an interest-free loan to the issuer, which is why it is common for banks to sell them "commission free" to their customers.

Obverse and reverse side of traveller's cheque of National Bank of Poland (nominal value: 1000 Polish złoty ); sold in April 1989 in Budapest ( Hungary ), for use during travel to Poland only, never used.
Security hologram against counterfeit on cheques with the denomination of 50 US-Dollars from American Express , c. 2012.
Coutts & Co. traveller's cheque, for 2 pounds. Issued in London, 1970s. Langmead Collection. On display at the British Museum in London
A number of American Express cheques bought at the same time at a bank in 2012, which show one of the safety features - the consecutive serial numbers. The buyer gets a printed list with the numbers, and when cashing one or more, they mark those on the list. When the rest is lost or stolen, the list serves as proof of the fact which cheques were already cashed.