POSB Bank

Post Office Savings Banks

• People’s Own Savings Bank.

Functions

• It accept deposits from individuals and companies.
• It operates savings accounts which earn tax free interest.
• It operates stop order facilities for clients.
• It lends money to large organisations for example Discount Houses.
• It invests money into Treasury Bills and municipal stocks.
• It issues cheques upon request.
• It provides ATMs (Automated Teller Machines).
• It provides money orders and postal orders.

Money Order

• A means of payment suitable for paying large amounts.
• The sender fills in ink the amount to be sent.
• He/she states the name of the payee.
• The sender is given a certificate as a proof of postage.
• Money is paid at the sender’s post office.
• Money is transferred to the payee’s nearest Post Office for payment.
• The payee is paid at his/her local Post Office upon his/her identity being verified.
• They can be crossed for security purposes.
• They are a safe way of sending Money.
• They are valid for 12 months from the date of issue.

Postal orders

• They are suitable for sending small amounts of money through the Post Office.
• These documents are issued in lieu of cash.
• They are printed in fixed denominations.
• The sender buys the denomination equivalent to the money to be sent.
• The sender then fills in the payee’s name and posts the order to him/her.
• Upon receiving the Postal Order, the payee takes the postal order to the named Post Office and cashes it by signing.
• If it is crossed, the payee will have to deposit it into a bank account.

To learn more about other financial institutions go to this page.

To access more topics go to the Commerce Notes page.