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Disadvantages of travellers cheques when travelling

Updated April 17, 2017

Travelling to a foreign country is an exciting time. When travelling, many individuals will turn to the use of a traveller's check as their means of currency in another country. A traveller's check is a specialised check that can be purchased at a bank. It is used instead of an ATM or credit card and comes in several different currencies. Though they have advantages, there are some disadvantages to using traveller's checks.

Commission Rates

Unlike the use of an ATM or credit card, when using traveller's checks you must deal with a 1 per cent commission rate for each check that you cash. There are some locations that will charge slightly higher commission rates. If traveller's checks are the sole means for financing travel, these commission rates can add up quickly.

Bank Locations

Most traveller's checks have to be cashed at local banking institutions in order to get the funds. In order to do this, an individual needs to find a bank that accepts traveller's checks. With that comes the painstaking task of waiting in line and signing each individual check that needs to be cashed. In rural areas or third world countries, it can be difficult to find a bank or location willing to cash traveller's checks.

Replacing Lost or Stolen Cheques

Losing a traveller's check does come with some reassurance, but also some hassles. When purchasing a traveller's check, individuals are given a receipt for the purchase. This receipt should be kept in a different location than the checks themselves. In the event traveller's checks are lost or stolen, an individual must present this receipt as proof of purchase. Some institutions will take 24 to 48 hours to replace the checks, which can be inconvenient when stuck in a foreign country. In the event the receipt is also lost or stolen, the replacement process can be delayed even further.

Merchant Refusals

There was once a day when a traveller could make a direct purchase from a merchant with a traveller's check. Unfortunately, more merchants in foreign countries are refusing to accept traveller's checks and will only accept cash or credit cards. That means that the individual will first have to go to a local bank location, cash their check for local currency and then make a purchase.

Range of Currencies

Though a traveller's check can be purchased for currencies such as Euro, Canadian Dollars, Yen, Australian Dollars and Pound Sterling, there are limitations to other foreign currencies. When travelling to third world countries many companies will not sell traveller's checks in the correct currency. This means that the traveller will have to purchase the traveller's checks in their current currency and cash them for the country's currency upon visiting. This means that checks will be subject to an exchange rate which can fluctuate depending on the day or month they are used.

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About the Author

Shailynn Krow began writing professionally in 2002. She has contributed articles on food, weddings, travel, human resources/management and parenting to numerous online and offline publications. Krow holds a Bachelor of Science in psychology from the University of California, Los Angeles and an Associate of Science in pastry arts from the International Culinary Institute of America.