3. Advices.—A letter of advice (Figure 2) , au thenticating the draft and usually containing the fol lowing particulars, is sent to the branch or corres pondent on whom the draft is drawn: 1. Number of the draft 2. Amount of the draft 3. Date of issue of draft 4. Name of payee 5. Name of bank at which drafts will be pre sented by bearer if other than correspondent drawn on (if the draft is to be readvised to bank at which it will be presented, a note to this effect is added to the advice) 6. Particulars of the mode of reimbursement (cover-draft inclosed, debit amount to account, etc.).
Should the draft be payable by a third party (see above) for account of the correspondent on whom it is drawn, this third party is also advised either by the issuing bank direct or by its correspondent on receipt of advice from the issuing bank.
The relative advices should be dispatched as soon as possible after the sale of the drafts in order that payment may not be refused thru the correspondent's being unable (in the absence of advice) to authenti cate the drafts.
4. Specimen forms and bank furnishes the correspondents on whom it has arranged to issue drafts with specimens of the special draft form and of the special advice form (if any) it will use, together with specimen signatures of the officers who are authorized to sign drafts and advices on its behalf. If possible, a specimen signature of the payee is also forwarded with the advice of a draft, so that any possible difficulty in establishing the bona fides of the payee and draft may be avoided.
5. Cost of drafts to amount to be charged by the issuing bank to the purchaser of a demand draft is ascertained by adding together the amounts mentioned below: 1. Face amount of the draft (if drawn in a for eign currency the amount is converted into local currency at the rate of exchange for the day) 2. Commission of the issuing bank 3. Commission (if any) of the paying bank 4. Cost of postage on advises.
6. Travelers' checks.—Travelers' checks enable a traveler to provide himself with funds without delay in a convenient yet inexpensive manner, at any point of his journey. They are issued in denominations of even amounts ($10, $20, $50, $100 and $200; £5, £10, £20, etc.), with the exact equivalent in the moneys of the principal foreign countries stated on the face of each check. ( See Figures 3 and 4.) They may be cashed practically anywhere, are self identifying and easily negotiated, and are therefore one of the safest and best forms in which to carry money when traveling. They are issued by all first class banks at a small premium.
So far as travelers are concerned, such checks are often more convenient than drafts. The latter must be cashed in one lump sum which may be much larger than the traveler wishes to carry on his person, and which may be a positive disadvantage if he passes into another country where a different currency is in use.
The checks are for relatively small amounts, can be cashed as needed and are generally accepted by ho tels and large stores, without imposing on the traveler the burden of cashing them at a bank.
In view of the undoubted advantages in their par ticular sphere which travelers' checks possess over drafts, their greater cost, the widespread nature of the initial arrangements and the fact that the exchange charged by correspondents on the checks is met by the issuing bank, the slightly higher commission charge which is made by banks for travelers' checks is fully justified.
7. Payment of issuing bank usually holds the paying agents of their travelers' checks free from responsibility in cashing such checks, provided: (a) The holder signs them in the presence of the paying agent.
(b) The signature of the holder and that of the countersigning officer agree with the signatures con tained in the relative letter of indication.
(c) The numbers of the checks are entered on the letter of indication.
(d) The checks are negotiated within the period specified (usually twelve months from date of issue).
(e) The other general terms of the circular of in structions are duly complied with.' 8. Payment to countries specified on the face of the check the face amount of local cur rency is paid to the holder without deduction except for revenue stamps (if any) .2 In other countries the equivalent of the sterling amount is paid to the holder at a rate of exchange which includes the commission and other charges cf the paying agent.
In countries where a revenue stamp is necessary the cost of such stamp is charged to the holder of the check.' 9. Redemption of checks are redeemed as follows: (a) If paid in North America, they are forwarded to the New York office or correspondent of the is suing bank of redemption at the face amount of dol lars plus the commission agreed (b) If paid outside North America, they are for warded to the London, England, branch or corre spondent of the issuing bank for redemption at the face amount of sterling (or its equivalent) at the cur rent rate of exchange plus commission at the rate agreed upon. (In the case of countries not specified on the face of the check, the paying agent has already obtained his commission from the conversion of ster ling into local currency and the checks are therefore redeemed at the face amount of sterling.) (c) Banks having extensive business relations with various European countries occasionally appoint their chief correspondents in the respective countries as central redemption agents for their travelers' checks. In such cases the paid checks are forwarded to these correspondents for redemption at the face amount of local currency plus the commission agreed upon, and are debited to the account which the issuing banks keep with these correspondents.