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Legal Definitions - passbook
Definition of passbook
A passbook, also commonly known as a bankbook, is a physical booklet issued by a financial institution to an account holder. It serves as a tangible record where the bank manually or mechanically enters details of all transactions related to a specific savings or deposit account. This includes deposits, withdrawals, interest payments, and other account activity, providing the account holder with an updated, official summary of their account balance and history.
Example 1: Managing Retirement Savings
Mrs. Eleanor Vance, who prefers traditional banking methods, maintains a passbook savings account for a portion of her retirement funds. Every month, after depositing her pension check, she visits her local bank branch. The teller takes her passbook and uses a special machine to print the latest deposit, along with the updated balance, directly into the booklet. This allows Mrs. Vance to have a clear, physical record of her savings growth without needing to use online banking or ATMs.
Example 2: A Child's First Savings Account
When ten-year-old Maya received money for her birthday, her parents took her to the local credit union to open her very first savings account. The credit union provided Maya with a colorful passbook. Each time she deposits her allowance or gift money, the teller stamps the date and amount into her passbook, showing her how her savings are accumulating. This helps Maya visually track her money and learn about financial responsibility.
Example 3: Rural Community Banking
In the small town of Willow Creek, where internet access can be unreliable, many residents rely on the local community bank's passbook accounts. Mr. Jenkins, a farmer, uses his passbook to manage his seasonal earnings. After selling his crops, he deposits a large sum, and the bank clerk immediately updates his passbook with the transaction details and new balance. This ensures he has an instant, physical confirmation of his funds, which is crucial for planning his next season's expenses.
Simple Definition
A passbook is a physical booklet issued by a bank to a depositor. In this book, the bank manually records all transactions, such as deposits and withdrawals, made on that specific account. It is also commonly referred to as a bankbook.