What is an electronic money order?

Businessman with a folder

An electronic money order is a method of transferring money between banks and people. This financial product is available from most postal service offices and is similar to a certified check. A user can purchase a money order and transfer the money to a target bank or individual. Money is normally sent to the destination merchant at the time of the transaction.

The United States Postal Service provides guaranteed electronic money order certificates. These notes contain special engravings and watermarks designed to make documents more difficult to forge. The postal service identifies each certificate with a unique number. These money orders are only available after full payment is completed.

Electronic money order has the same risks of forgery as any paper business document. Counterfeit rings use artists to create fraudulent paper documents as a method of stealing money from individuals and organizations. Many criminals have successfully created fraudulent payment orders and placed them in the global economy.

There are several advanced features available to money order customers. The electronic payment order can be managed and created with a personal computer and a printer. This requires an individual to create an account in which they will transfer money to a deposit account to be used for future money orders. When he wants to create a money order, the funds are automatically withdrawn from his account when the paper document is created.

Money orders are typically mailed or hand-delivered to individuals or companies. These paper documents are similar to certified checks in that the money order requires full payment before it is created. It is considered a check verified through a funds transfer.

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In the last decade, many new types of currency exchange devices have become available. These modern electronic methods have made using electronic checks and money orders less attractive to most consumers. With the popularity of debit cards and third-party fund management systems, exchanging paper notes is becoming bulky and cumbersome.

Most modern financial institutions have automated the process of paying bills over the Internet. This has provided customers with a means of paying bills that offers fast payment without the hassle of sending checks or money in the mail. Paying bills online is an example of modernized financial management.

Money orders are also used by people who are uncomfortable with bank accounts and financial institutions. These individuals will use money orders as a method of paying monthly bills. Using a money order provides an audit trail for paying bills that is not available when using cash.

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