# What Are Traveler's Checks? Definition, Uses, and Purchase Guide

![Traveler's Check](https://www.investopedia.com/thmb/krDuAaSFIGf4u3ndoRn0MO8uZII=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/travelerscheck.asp-final-adc678f0e5934819a819eff88b8d1ec4.jpg)

*— Investopedia / Eliana Rodgers*

## What Is a Traveler’s Check?

Traveler’s checks, once widely utilized for safe international travel purchases, provide security against loss and theft and can be used to purchase goods or exchanged for cash in many countries. However, with the rise of credit and debit cards, their use has significantly dwindled.

The product is typically used by people on vacation in foreign countries. It offers a safe way to travel overseas without the risks associated with losing cash. The issuing party, usually a bank, provides security against lost or stolen checks.

Credit cards and prepaid debit cards have largely replaced traveler's checks.

### Key Takeaways

*   Traveler's checks are a secure form of payment that can be easily replaced if lost or stolen, making them a safer option than carrying large amounts of cash.  
    
*   Originally designed to aid international travelers, their usage has declined due to the convenience of credit and prepaid cards.  
    
*   Purchase fees apply to traveler's checks, and their availability is limited to a few financial institutions like American Express and Visa.  
    
*   Traveler's checks can be cashed, used for purchases, or deposited into bank accounts, but fewer places accept them compared to modern payment methods.  
    
*   Alternatives such as prepaid travel cards and credit cards offer similar, and often greater, convenience and security for international travel.

## Understanding the Functionality of Traveler's Checks

A traveler’s check is for a prepaid fixed amount and operates like cash, so a purchaser can use it to buy goods or services when traveling. A customer can also exchange a traveler’s check for cash. Major financial service institutions issue traveler’s checks, and banks and [credit unions](https://www.investopedia.com/terms/c/creditunion.asp) sell them, though their ranks have significantly dwindled today.

> **Important**
>
> Like regular checks, traveler's checks have a unique serial number. If one is lost or stolen, it can be canceled and replaced by the issuer.

Traveler's checks are available in fixed denominations and various currencies, useful in countries with [changing exchange rates](https://www.investopedia.com/articles/personal-finance/082114/best-places-exchange-currency.asp) and they don't expire. They are not linked to a customer’s bank account or line of credit and do not contain personally identifiable information, therefore eliminating the risk of identity theft. They operate via a dual signature system. You sign them when you purchase them, and then you sign them again when you cash them, which is designed to prevent anyone other than the purchaser from using them.

Many banks, hotels, and retailers once accepted them as cash, though fees sometimes applied. However, as credit and prepaid cards gain popularity, finding places to cash traveler's checks is increasingly difficult.

## The Evolution of Traveler's Checks

James C. Fargo, the president of the American Express Company, was a wealthy, well-known American who was unable to get checks cashed during a trip to Europe. In 1891, a company employee, Marcellus F. Berry, believed that the solution for taking money overseas required a check with the signature of the bearer and devised a product for it. American Express and Visa still use the British spelling on their products.

## Where to Purchase Today's Traveler's Checks

[Visa](https://usa.visa.com/support/consumer/travelers-cheques.html) and [AAA](https://exchange.aaa.com/international-travel/aaa-travel-services/) still issue traveler's checks, though usually with a fee. AAA also offers prepaid Visa cards now. They often come with a purchase fee. AAA now offers members pre-paid international Visa cards instead of paper checks.

In the U.S., they are available primarily from American Express locations. You can also buy traveler's checks online from the American Express website, but you need to be registered with an account. Visa offers traveler's checks at Citibank locations nationwide, as well as at several other banks.

> **Important**
>
> American Express, Visa, and AAA are among the companies that still issue traveler’s checks.

## How and Where to Cash Traveler's Checks

You can deposit traveler's checks at your bank or cash them at many hotel lobbies free of charge. Many hotel or resort lobbies will also provide this service to guests at no charge. American Express also provides a service to redeem traveler's checks that they issue online to be deposited into your bank account.

## Pros and Cons of Using Traveler's Checks

 Traveler's checks offer security for tourists wary of losing cash, as they can be reported lost or stolen and replaced. Their easy replacement lowers the risk of loss or theft, but traveler's checks are less popular now due to the convenience of credit and debit cards. This was particularly a concern before credit cards and ATMs were widespread and affordable worldwide for most travelers. At the same time, these paper checks are now a bit outdated and come with a fee to purchase, making them potentially more expensive and cumbersome than using plastic or electronic payments.

Pros

*   Replaced if lost or stolen
    
*   Widely accepted around the world
    
*   Convenient to use
    
*   They don't expire
    

Cons

*   Outmoded
    
*   Must have the physical check to use it
    
*   Incurs a fee to purchase
    
*   Limited number of issuers today
    

## Modern Alternatives to Traveler's Checks

The most obvious alternative is to use a credit or debit card issued by a bank that works worldwide and charges low or no foreign exchange fees on purchases or ATM withdrawals. If your bank doesn't allow for this or charges high fees, then prepaid travel cards are the modern version of traveler’s checks. They allow you to get local currency from ATMs and make purchases with merchants—effectively eliminating the need for traveler’s checks.

Prepaid cards are not linked to your bank account, which prevents anybody from draining your checking account if the card gets lost or stolen—and you can’t go into debt. Credit cards offer similar (or better) protection, but you might not want to use your everyday card abroad. By using a dedicated travel card, you avoid spreading your card numbers around, which means you can be less vigilant about monitoring your accounts when you get back home. Visa and MasterCard both offer prepaid cards designed for use abroad. Those cards are available online, through travel agents, and at banks or credit unions. 

Travel cards should feature low ATM fees, technology that lets you operate like a local in foreign countries, emergency cash when you lose the card, and “zero liability” fraud protection. That said, prepaid cards can be expensive, so you need to compare fees against your other cards to decide whether or not a travel card makes sense.  

For U.S. citizens living abroad for extended periods, maintaining checking and other bank accounts in the United States provides several advantages, and many checking accounts are [friendly for foreign transactions](https://www.investopedia.com/articles/personal-finance/053116/top-10-checking-accounts-us-expats-living-abroad-cof-schw.asp#citibank).

## Where Do You Buy Traveler's Checks?

You can buy still buy traveler's checks from Visa and a handful of other financial institutions. To buy them, visit a location or check the website of an issuing institution. You may need a photo ID in order to set up an account.

## How Do You Cash Traveler's Checks?

Some hotels, resorts, and currency traders will cash traveler's checks in exchange for local currency. However, with the rising prevalence of credit and debit cards fewer locations cash traveler's checks.

## What Do You Do With Traveler's Checks?

Traveler's checks are a secure way of carrying money while abroad. Many businesses in the tourism industry will cash traveler's checks, and they can also be deposited into a bank account. Because the checks can be easily replaced, they have a lower risk of theft or loss. However, traveler's checks have fallen out of favor due to the increased convenience of credit cards and prepaid debit cards.

## The Bottom Line

Traveler's checks offer a secure method for carrying money abroad, with the advantage of easy replacement if lost or stolen. Historically popular for their fixed denominations and acceptance for purchases, they have been largely replaced by more convenient options like credit and prepaid debit cards.

While some institutions still issue them, travelers may find it increasingly difficult to cash these checks due to the widespread acceptance of plastic and electronic payment methods. Modern travelers are often better served by credit cards and prepaid travel cards, which provide added security and accessibility without the drawbacks of additional fees or the need for physical checks.

> **Article Sources**
>
> 1.  Sparks, Evan. “[Nine Young Bankers Who Changed America: Marcellus Flemming Berry](https://bankingjournal.aba.com/2017/06/nine-young-bankers-who-changed-america-marcellus-flemming-berry/).” ABA Banking Journal, June 26, 2017.
>     
> 2.  Time Magazine. "[Travel (April, 1956): The Host with the Most](http://content.time.com/time/subscriber/article/0,33009,866900-7,00.html)."
>     
> 3.  American Express. "[Travelers Cheques](https://www.americanexpress.com/us/travel/travelers-cheques/)."