Table of Contents
Introduction: Understanding the Concept of a Passbook
A passbook is a small sized book which has the records of transactions made in a savings account by an account holder. It is a conventional form of banking and is still in use even in the present society. The passbook holds information on deposits, withdrawals, interest generated, and the current balance. The bank marks it every time there is a transaction, and the account holder can use it to check the account history.
The Pros of Using a Passbook: Security, Convenience, and Budgeting
The major advantage of using a passbook is security. This is because; online banking has its challenges such as hacking and other cyber attacks while a passbook is a piece of paper that cannot be accessed from another machine. This way the account holder has the access to the passbook and can keep it with him/her at all times and prevent others from accessing it. Furthermore, in case the passbook is lost or stolen the account holder can notify the bank and request for another one to avoid losing the money. The following are the advantages of using a passbook: They are secure; As mentioned above, one of the greatest strengths of using a passbook is that it is less vulnerable to theft or loss than an online account.
Easily accessible: As for the available banking system, a passbook can be easily obtained and used by people who may not have access to the internet or may not be in a position to go to the bank frequently. Helps in budgeting: This is because the account holders are able to know where the money is going and how much is being spent through the use of a passbook. This helps people identify areas where they can reduce their spending and be able to save more money. In addition, the passbooks can be used for goal setting and goal achievement in the financial area.
The Cons of Using a Passbook: Limited Accessibility and Inconvenience
Despite the benefits of using a passbook, there are some disadvantages that one must consider. The major limitation however is that of access. This is because while online banking can be accessed from any computer connected to the internet, passbooks can only be replenished at the bank. This can be inconvenient for the people who do not have a bank nearby or for those who have a very tight schedule and cannot always find time to visit the bank. The other disadvantage of using a passbook is that it is rather tedious to use when compared to the electronic banking system. In addition, in case the passbook is lost or stolen the account holder has to make arrangements for a new one which can be quite an ordeal.
Passbooks are also much more basic than online banking. Online banking has more features than this; the account holders are able to transfer money from one account to another, pay bills and even get other services. Passbooks however are used mainly for signing of transactions and checking of balances.
Conclusion: Is a Passbook Right for You? Factors to Consider Before Making a Decision
Whether or not to use a passbook will depend on your situation and preferences. If you are a risk averse and you want to be sure that your account is secure and easily accessible, then a passbook could be the way to go for you. However, if you make frequent deposits and withdrawals or if you want to have more services than those offered by the passbook then online banking may be more suitable for you.
First of all, it is worth thinking about some parameters, for example, where you live, how often you work, what bank you have. If you have no easy access to bank branches or you work when the bank is closed, then a passbook may not be for you. On the other hand, if you like the idea of having a physical copy of your account and you don’t need to withdraw money often, then a passbook might be for you.
In this case, the decision to use a passbook or online banking depends on personal preferences only. You should know the advantages and disadvantages of each of the options and then make your decision based on your personal situation.
