Passbook accounts are issued to customers by banks to help them keep track of their transactions, including deposits and withdrawals. These types of accounts are not as popular as they once were, but they are still offered by some financial institutions.
Transaction Record
Someone holding a passbook account must take the book with him to the bank when he has a transaction completed. The teller updates the transaction with a printer. In the past, tellers had to write the transactions in the passbook.
Account Activity
Customers using passbooks typically do not have a large number of transactions, so they have no need for monthly statements.
Terms and Fees
Passbook accounts do not have as many fees or penalties as standard bank accounts often do, but some may have a minimum balance requirement.
Rate of Interest
Passbook accounts are not recommended for profitable investing, because they pay a very low rate of interest. Anyone hoping to build a large sum of money may want to consider other investing instruments offered by a bank.
FDIC Insured
Passbook savings accounts are liquid, and they are considered one of the safest instruments for saving your money. They are insured by the Federal Deposit Insurance Corporation (FDIC).
References
Writer Bio
Melvin J. Richardson has been a freelance writer for two years with Associated Content, and writes about topics such as banking, credit and collections, goal setting, financial services, management, health and fitness. Richardson has worked for several banks and financial institutions and gained invaluable experience and knowledge. Richardson holds a Master of Business Administration in Executive Management from Ashland University in Ashland Ohio.