Eurocheque
Encyclopedia
Cheque
A cheque is a document/instrument See the negotiable cow—itself a fictional story—for discussions of cheques written on unusual surfaces. that orders a payment of money from a bank account...
used in Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
that was accepted across national borders and which could be written in a variety of currencies.
Eurocheques were originally introduced in 1969 as an alternative to the traveler's cheque
Traveler's cheque
A traveler's cheque is a preprinted, fixed-amount cheque 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.- Usage :As traveler's cheques can usually be replaced if lost or stolen A traveler'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
Clearing (finance)
In banking and finance, clearing denotes all activities from the time a commitment is made for a transaction until it is settled. Clearing is necessary because the speed of trades is much faster than the cycle time for completing the underlying transaction....
Eurocheques were substantially lower than those for cross-border use of domestic cheques.
Although still accepted as payment by a few bodies, the practice of issuing Eurocheques ceased on 1 January 2002, following the decision to withdraw the Eurocheque guarantee. That it was the same date that the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
currency was introduced and the similarity of the names were only coincidences.
Eurocheques were particularly popular in German-speaking
German-speaking Europe
The German language is spoken in a number of countries and territories in West, Central and Eastern Europe...
countries, where they were often issued as standard domestic cheques. They usually had to be accompanied by a cheque guarantee card
Cheque guarantee card
A cheque guarantee card is essentially an abbreviated portable letter of credit granted by a bank to a qualified depositor, providing that when he is paying a business by cheque and the retailer writes the card number on the back of the cheque, the cheque is signed in the retailer's presence, and...
in order to be accepted in payment at a point of sale. The Eurocheque guarantee card also had the functionality of an ATM card
ATM card
An ATM card is a card issued by a bank, credit union or building society that can be used at an ATM for deposits, withdrawals, account information, and other types of transactions, often through interbank networks.Some ATM cards can also be used:* at a branch, as identification for in-person...
. In some countries, such as Austria
Austria
Austria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
and Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
, virtually all Eurocheque cards were co-branded with the logo of the respective domestic debit card
Debit card
A debit card is a plastic card that provides the cardholder electronic access to his or her bank account/s at a financial institution...
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 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
Automated teller machine
An automated teller machine or automatic teller machine, also known as a Cashpoint , cash machine or sometimes a hole in the wall in British English, is a computerised telecommunications device that provides the clients of a financial institution with access to financial transactions in a public...
and credit cards by international travellers grew within Europe. The relatively high cost of processing Eurocheques, together with the costs resulting from fraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
, were also among the factors. In advance of the move, the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
expressed concern that "the benefits of the existing eurocheque system, in particular its standardised cheque format and its clearing facilities in all European countries should not be lost."
History
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
, France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
, United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, the Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
, Austria
Austria
Austria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
, Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
and West Germany
West Germany
West Germany is the common English, but not official, name for the Federal Republic of Germany or FRG in the period between its creation in May 1949 to German reunification on 3 October 1990....
(which issued and accepted Eurocheques) together with Denmark
Denmark
Denmark is a Scandinavian country in Northern Europe. The countries of Denmark and Greenland, as well as the Faroe Islands, constitute the Kingdom of Denmark . It is the southernmost of the Nordic countries, southwest of Sweden and south of Norway, and bordered to the south by Germany. Denmark...
, Italy
Italy
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
, Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
, Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
, Norway
Norway
Norway , officially the Kingdom of Norway, is a Nordic unitary constitutional monarchy whose territory comprises the western portion of the Scandinavian Peninsula, Jan Mayen, and the Arctic archipelago of Svalbard and Bouvet Island. Norway has a total area of and a population of about 4.9 million...
, Spain
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
and Sweden
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
(which accepted Eurocheques).
In 1972, 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 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 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 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 together with EUROCARD International N.V.
EUROCARD (payment card)
Eurocard was a credit card, introduced in 1964 by a Swedish banker in the Wallenberg family as an alternative to American Express.-History:In 1965, Eurocard International N.V. was established, based in Brussels, as a not-for-profit membership association of European banks. Its operational entity...
into a single company, Europay International S.A.
Europay International
Europay International was the name of the entity created by the merger of Eurocard International, and Eurocheque International. The merged entity was headquartered in Waterloo, Belgium, on the same premises as EPSS and MasterCard EMEA .Europay International was the owner of the...
, incorporated under Belgian law. Europay relocated to Waterloo, Belgium
Waterloo, Belgium
Waterloo is a Walloon municipality located in the province of Walloon Brabant, Belgium. On December 31, 2009, Waterloo had a total population of 29,573. The total area is 21.03 km² which gives a population density of 1,407 inhabitants per km²...
, where they shared the same address as the Europe, Middle East and Africa
Europe, the Middle East and Africa
Europe, the Middle East and Africa, usually abbreviated to EMEA, is a regional designation used for government, marketing and business purposes...
region of MasterCard International
MasterCard
Mastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...
, 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.