Cheque guarantee card

A cheque guarantee card or check guarantee card (American English) was an abbreviated portable letter of credit granted by a bank to a qualified depositor in the form of a plastic card that was used in conjunction with a cheque. Many ATM cards and some credit cards could also be used as cheque guarantee cards.

The scheme provided retailers accepting cheques with greater security. The retailer would write the card number on the back of the cheque, which was signed in the retailer's presence, and the retailer verified the signature on the cheque against the signature on the card. In North America, where cheque guarantee cards were less common, merchants alternately often required customers presenting cheques for payment to provide photo identification and a secondary form of identification such as a credit card for them to be accepted.

The cheque could not be stopped and payment could not be refused by the bank. Each bank would set a limit on the maximum amount of an individual cheque that could be guaranteed. The guarantee only applied to cheques drawn on an account provided by the bank that issued the card, and could result in an overdraft with penalty interest on the cardholder.

After the introduction of debit cards and widespread deployment starting in the 1990s, there was a rapid decline in the use of cheques and of cheque guarantee cards, and these facilities were generally phased out during the 2000s in the countries that operated them. The Irish cheque guarantee scheme officially ended on 31 December 2011, ending the last such scheme in existence.