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38-485: Eurocheques were introduced in 1969 as an alternative to the traveller's cheque and for international payments for goods and services. They were rapidly adopted for domestic use in a number of countries, to the extent that their use for international payment rarely accounted for more than 5% of total Eurocheque transactions. The charges for clearing Eurocheques were substantially lower than those for cross-border use of domestic cheques. Although still accepted as payment by

76-1013: A cooperative society established under Belgian law, having previously been a de facto association, rather than a legal entity. The shareholders were the Association of Swedish Banks, Associazione Bancaria Italiana , Groupement des cartes bancaires 'CB' (France), Comunidade Portuguesa eurocheque, Bank of Cyprus, Caisse d'épargne de l'État du grand-duché de Luxembourg, Agrupació Andorrana Eurocheque, PBS-Pengeinstitutternes BetalingsSystemer (Denmark), Apacs (United Kingdom), Telekurs (Switzerland), Suomen Pankkiyhdistys (Finland), Association of Norwegian Banks, Stichting Bevordering Chequeverkeer (Netherlands), Irish Clearing House, Jugobanka United Bank (Yugoslavia), Association of Austrian Banks and Bankers, Eurocheque Belgique sc, GZS-Gesellschaft für Zahlungssysteme GmbH (Germany). According to an estimate by Eurocheque International, in 1989 around 32 million Eurocheque cards had been issued by some 9,000 banks in 20 countries. By

114-568: A not-for-profit membership association of European banks . Its operational entity was established as European Payment System Services (EPSS). In 1968, Eurocard International and the Interbank Card Association entered into a strategic alliance , in which both issuer's cards would be accepted on either network. This allowed the ICA to get an instant European acceptance network, and Eurocard to get accepted worldwide. Eurocard International got

152-535: A few bodies, the practice of issuing Eurocheques ceased on 1 January 2002, following the decision to withdraw the Eurocheque guarantee. Eurocheques were particularly popular in German-speaking countries, where they were often issued as standard domestic cheques. They usually had to be accompanied by a cheque guarantee card in order to be accepted in payment at a point of sale. The Eurocheque guarantee card also had

190-582: A joint venture known as Maestro International in 1992, and merger in 2002. Its operations were relocated to Belgium in the end of the 1960s, and the card became the dominant brand in North and Central Europe between 1970 and 2002. It was eventually replaced by the Mastercard brand in most locations, but its logo is still used in some countries. In 1965, Eurocard International N.V. was established, based in Brussels , as

228-446: 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 incentive for merchants and other parties to accept them lies in

266-541: A traveller's cheque would follow its normal procedures for depositing cheques into its bank account: usually, endorsement by stamp or signature and listing the cheque and its amount on the deposit slip. The bank account will be credited with the amount of the cheque as with any other negotiable item submitted for clearance. In the United States , if the payee is equipped to process cheques electronically at point of sale ( see: Check 21 Act ), they would still take custody of

304-502: Is displayed at locations which accept MasterCard cards. The Eurocard logo is not used any more, as the acceptance mark is discontinued and merged into MasterCard. However, the use of Eurocard as a brand for MasterCard credit cards is limited to Scandinavian countries and the Baltic countries. In other former Eurocard markets, such as the German speaking countries, this brand was fully replaced by

342-464: Is still the largest issuer of traveller's cheques today by volume. 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

380-480: The 'uniform Eurocheque' and 'uniform Eurocheque guarantee card' were introduced, providing single designs that could be used by all banks within the system. Previously all Eurocheques had carried the Eurocheque symbol, but differed in their designs. Eurocheque International C.V. was formed in 1974 to process payments made using Eurocheques. In 1983, British banks withdrew the Eurocheque symbol from their credit cards. On 3 February 1988, Eurocheque International became

418-466: The Eurocheque symbol from their credit cards. In the same year, the use of the Uniform Eurocheque format became universal. On 1 September 1992, Eurocheque International C.V. and Eurocheque International Holding N.V. merged with Eurocard International N.V. into a single company, Europay International S.A. , incorporated under Belgian law. Europay relocated to Waterloo, Belgium , where they shared

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456-582: The banks that issued them. Since traveller's cheques do not earn interest, one of the main incentives financial institutions have to sell traveller's cheques is that they effectively represent an interest-free loan from the purchaser to the seller. The sustained decline in interest rates in most of the developed world since the early-to-mid 1990s has substantially reduced the profitability of traveller's cheques for their issuers. Financial institutions have responded to this development by charging new fees for traveller's cheques, increasing existing fees, or by exiting

494-441: The business altogether. Travellers' cheques are sold by banks and agencies to customers for use at a later time. Upon obtaining custody of a purchased supply of traveller's cheques, the purchaser immediately signs each cheque. The purchaser also receives a receipt and other documentation that should be kept in a safe place other than where they carry the cheques. Traveller's cheques can usually be replaced if lost or stolen, assuming

532-436: The cheque and submit it to a financial institution, particularly to avoid any confusion on the part of the purchaser. One of the main advantages traveller's cheques provide is the replacement if lost or stolen. However, this feature has also created a black market where fraudsters buy traveller's cheques, sell them at 50% of their value to other people (such as travellers) and falsely report their traveller's cheque stolen with

570-402: The cheque holder, making them effectively interest-free loans. Also, the foreign exchange rate commonly used on traveller's cheques (generally based on rates applicable at the time of purchase) is less favourable compared to other forms of obtaining foreign currency, especially those on credit card transactions (which use a rate applicable at the transaction date). In addition, the setup cost and

608-404: The company from which the cheque was obtained. As such, the fraudster gets back the value of the traveller's cheque and also makes 50% of the value as profit. The widespread problem of counterfeit traveller's cheques has caused a number of businesses to no longer accept them or to impose stringent safeguards when they are used. It is a reasonable security procedure for the payee to ask to inspect

646-593: The cost of issuing and processing traveller's cheques is much higher than for credit card transactions. The cheque issuer carries the exchange rate risk , and normally pays a fee to hedge against the risk. Their use has been in decline since the 1990s, when a variety of more convenient alternatives, such as credit cards , debit cards , money transfer services , pre-paid currency cards , and automated teller machines that accept foreign cards, became more widely available and easier for travellers to use. Also, as interest rates sharply declined in many developed countries in

684-668: The dominant brand in Central European countries, more specifically in Germany , the Netherlands and Austria . It lagged behind Visa in southern European countries, such as Spain and France . Today, the Eurocard name exists in combination with the MasterCard acceptance mark as a product name. This means that the Eurocard name is still used on a card, although only the MasterCard logo

722-664: The end of 1998, there were 46 participating countries, 22 of them both issuing and accepting the cheques: Belgium, Denmark, Germany, Finland, France, United Kingdom, Ireland, Israel, Italy, Croatia, Luxembourg, Malta, Netherlands, Poland, Portugal, Switzerland, Slovenia, Spain, the Czech Republic, Hungary, Cyprus, and 24 accepting cheques: Egypt, Albania, Algeria, Andorra, Armenia, Azerbaijan, Bosnia-Herzegovina, Bulgaria, Georgia, Gibraltar, Greece, Iceland, Lebanon, Lithuania, Latvia, Morocco, Macedonia, Romania, Russia, Slovakia, Tunisia, Turkey, Ukraine, Belarus. In 1989, French banks withdrew

760-511: The existing eurocheque system, in particular its standardised cheque format and its clearing facilities in all European countries should not be lost." The Eurocheque was launched in 1969 with the participation of banks in 14 countries: Belgium , France , United Kingdom , the Netherlands , Austria , Switzerland and West Germany (which issued and accepted Eurocheques) together with Denmark , Italy , Ireland , Luxembourg , Norway , Spain and Sweden (which accepted Eurocheques). In 1972,

798-412: The fact that as long as the original signature (which the buyer is supposed to place on the cheque in ink as soon as they receive the cheque) and the signature made at the time the cheque is used are the same, the cheque's issuer will unconditionally guarantee payment of the face amount even if the cheque was fraudulently issued, stolen, or lost. This means that a traveller's cheque can never 'bounce' unless

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836-433: The functionality of an ATM card . In some countries, such as Austria and Germany , virtually all Eurocheque cards were co-branded with the logo of the respective domestic debit card system and were actually debit cards. After its phase-out, virtually all of these Eurocheque cards were replaced by Maestro cards . Therefore, Maestro is very often considered to be the successor to the Eurocheque system. The decision to end

874-405: The issuer goes bankrupt or out of business. If a traveller's cheque were lost or stolen, it could be replaced by the issuing financial institution. The financial institutions issuing traveller's cheques earn income in a number of ways. Firstly, they charge a fee on sale of such cheques. In addition, they can earn interest for the period that the cheques are uncashed, while not paying any interest to

912-562: The issuing of Eurocheques was taken because increasing numbers of retailers and banks started to decline payment by Eurocheque and because the use of cash machines and credit cards by international travellers grew within Europe. The relatively high cost of processing Eurocheques, together with the costs resulting from fraud , were also among the factors. In advance of the move, the European Commission expressed concern that "the benefits of

950-541: 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. Traveller's cheques are no longer widely accepted and cannot easily be cashed, even at the banks that issued them. The alternatives to traveller's cheques are generally cheaper and more flexible. Travel money cards, for instance, provide features similar to traveller's cheques but offer greater ease and flexibility. Legally,

988-501: The obligor is both maker and drawee . Traveller's cheques were first issued on 1 January 1772 by the London Credit Exchange Company for use in 90 European cities, and in 1874, Thomas Cook was issuing " circular notes " that operated in the manner of traveller's cheques. American Express developed a large-scale international traveller's cheque system in 1891, to supersede the traditional letters of credit . It

1026-676: The owner still has the receipt issued with the purchase of the cheques showing the serial numbers allocated. To cash a traveller's cheque to make a purchase, the purchaser would, in the presence of the payee, date and countersign the cheque in the indicated space. Traveller's cheques are available in several currencies such as US dollars , Canadian dollars , pounds sterling , Japanese yen , Chinese yuan and euros ; denominations usually being 20, 50, or 100 (× 100 for yen) of whatever currency, and are usually sold in pads of five or ten cheques, e.g., 5 × €20 for €100. Traveller's cheques do not expire, so unused cheques can be kept by

1064-413: The parties to traveller's cheque transactions are as follows. The organisation that produces a traveller's cheque is the obligor or issuer . The bank or other place that sells it is the agent of the issuer. The natural person who buys the cheque is the purchaser . The entity to whom the purchaser hands the cheque in payment for goods or services is the payee or merchant . For purposes of clearance,

1102-421: The purchaser to spend at any time in the future. 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. The commission, where it is charged, is usually 1–2% of the total face value sold. Any change for a purchase transaction would be given in the local currency. A payee receiving

1140-519: The purchaser's picture ID ; a driving licence or passport should suffice, and doing so would most usefully be towards the end of comparing the purchaser's signature on the ID with those on the cheque. The best first step, however, that can be taken by any payee who has concerns about the validity of any traveller's cheque, is to contact the issuer directly; a negative finding by a third-party cheque verification service based on an ID cheque may merely indicate that

1178-478: 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 convenience and wider acceptance of such alternatives as credit and debit cards and

Eurocheque - Misplaced Pages Continue

1216-571: The same address as the Europe, Middle East and Africa region of MasterCard International , and the headquarters of the Eurocard-MasterCard joint-venture, Maestro International . The decision to end the Eurocheque guarantee from the end of 2002 was taken by Europay's board on 22 April 2001. Traveller%27s cheque A traveller's cheque is a medium of exchange that can be used in place of hard currency. They can be denominated in one of

1254-544: The seat of the joint venture of Eurocard MasterCard, Maestro International . In 2002, Europay International and MasterCard International merged. The name Europay disappeared, and the new organisation was later renamed MasterCard Worldwide , with the headquarters in Waterloo renamed MasterCard Europe. In 2008, Eurocard was taken over by the Swedish Skandinaviska Enskilda Banken . Eurocard has always been

1292-517: The service has no record about the purchaser (to be expected, practically by definition, of many travellers), or at worst that they have been deemed incompetent to manage a personal current account (which would have no bearing on the validity of a traveller's cheque). Some purchasers have found the process of filing a claim for lost or stolen cheques is cumbersome, and have been left without recourse after their cheques were lost or stolen. The widespread acceptance of credit cards and debit cards around

1330-403: The sole license to issue the ICA's Master Charge (later MasterCard) cards in Europe. In 1992, Eurocard International N.V., Eurocheque International C.V. and Eurocheque International Holding N.V. merged into a single company, Europay International S.A., and were relocated to Waterloo, Belgium . This location also housed the Europe, Middle East and Africa region of MasterCard International, and

1368-562: The traveller's cheque in electronic form. One of the major examples is the Visa TravelMoney card. Eurocard (payment card) Eurocard was a credit card , introduced in 1964 by Marcus Wallenberg Jr. of the Wallenberg family as an alternative to American Express . In 1968, it signed a deal with the Interbank Card Association (today's MasterCard ) so that their cards were accepted by each other's networks; this eventually led to

1406-458: The wider availability of ATMs has led to a significant decline in the use of traveller's cheques since the 1990s. In addition, security concerns of retailers has led to many businesses ceasing to accept them, in turn making them less attractive to travellers. This has led to complaints about the difficulty that holders have in using them. In much of Europe and Asia, traveller's cheques are no longer widely accepted and cannot be easily cashed, even at

1444-710: The world starting in the 1980s and 1990s significantly replaced the use of traveller's cheques for paying for things on holiday. In 2005, American Express released the American Express Travelers Cheque Card , a stored-value card that serves the same purposes as a traveller's cheque, but can be used in stores like a credit card. It discontinued the card in October 2007. A number of other financial companies went on to issue stored-value or pre-paid debit cards containing several currencies that could be used like credit or debit cards at shops and at ATMs, mimicking

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