How Do Traveler's Checks Work?

How Do Traveler's Checks Work?
Traveler's checks offer vacationers peace of mind as well as a source of money. The checks are not connected to a traveler's bank account, so if they're lost or stolen, they can easily be replaced by contacting the issuer. This convenience saves you the hassle and worry that comes with misplacing other forms of currency.


When a customer receives traveler's checks, his signature is printed on the traveler's check. When cashing the traveler's check, the customer must sign the check in front of the recipient, and the two signatures must match.


The individual using a traveler's check must pay a fee to the provider of the traveler's check in addition to the value of the check. According to the website, this money is used by the issuer to pay for processing the traveler's check when it is cashed.


Traveler's checks are the same size as standard, bank-issued checks. The amount for which the check can be cashed is printed on the front of the check, on the same side as the pre-printed signature of the individual cashing the check.


The first traveler's check was issued in 1891, according to The Great Idea Finder. The first person to cash a traveler's check was William Fargo in Leipzig, Germany, that same year. In that first year, American Express sold $9,120 in traveler's checks.


Traveler's checks can be purchased in five different currencies in addition to the U.S. dollar as of 2010, according to American Express. Available currencies include the Euro, Australian and Canadian dollars, pound sterling and Japanese yen.

Article Written By Alan Kirk

Alan Kirk has been writing for online publications since 2006. He has more than 15 years' experience in catering, management and government relations. Kirk has a bachelor's degree in business management from the University of Maryland.

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