CHAPTER VII
MONEY ORDERS
Previous to 1880 the Money Order system of India was managed by the Government Treasuries. Bills of Exchange (Hundis) current for twelve months were issued by one treasury payable upon another, and as there were only 283 offices of issue and payment in the country the money order was not a popular means of remittance—in fact, it failed altogether to compete with the remittance of currency notes by post.
In 1878 Mr. Monteath, Director-General of the Post Office, proposed to Government to take over the money order business from the treasuries. He argued that, with the small number of treasuries and the trouble involved in reaching one of these every time a money order had to be sent or paid, the existing system could never become popular. The Post Office was able to provide 5500 offices of issue and payment, and the number of these would be always increasing and becoming more accessible to the people. Mr. Monteath's proposal was strongly opposed by the Comptroller-General, but was accepted by Government and sanctioned by the Secretary of State on the 27th November, 1879.
On the 1st January, 1880, the Post Office took over the whole management of issue and payment of money orders, and the audit was performed by the Compiler of Post Office Accounts. For the purposes of money order work post offices were classified under four heads:
(1) Offices of issue.
(2) Offices of preparation.
(3) Offices of delivery.
(4) Offices of payment.
The office of preparation was always the head office of the district in which the addressee resided, and its duty was to prepare the money order in the name of the payee upon receipt of the intimation from the office of issue. The procedure was as follows: An application for a money order was made at the office of issue and, on payment of the amount with commission, a receipt was given to the remitter and the application was sent to the head office of the district in which the payee resided. This office was called the office of preparation, and if the payee resided in its delivery area it would also be both the office of delivery and payment. If, however, the payee resided at a sub or branch office, the office of preparation made out a money order for delivery at such sub or branch office and for payment at the post office named by the remitter in his application. It was not necessary for the office of delivery to be the office of payment; the remitter could name any office authorized to pay money orders as the office of payment. Upon receipt of the money order by the payee an acknowledgment signed by him was sent to the remitter, and the payee had to make his own arrangements for cashing his money order at the proper office of payment.
The commission charged on money orders was accounted for by postage stamps affixed to the back of the application by the office of issue, and the rates were as follows:
| Rs. | A. | P. | ||||
| Not exceeding | Rs. 10 | 0 | 2 | 0 | ||
| Exceeding | Rs. 10, | but not exceeding | Rs. 25 | 0 | 4 | 0 |
| " | Rs. 25 | " " | Rs. 50 | 0 | 8 | 0 |
| " | Rs. 50 | " " | Rs. 75 | 0 | 12 | 0 |
| " | Rs. 75 | " " | Rs. 100 | 1 | 0 | 0 |
| " | Rs. 100 | " " | Rs. 125 | 1 | 4 | 0 |
| " | Rs. 125 | " " | Rs. 150 | 1 | 8 | 0 |
Rs.150 was the maximum amount of a money order. Redirection was permissible, but such redirection did not affect the original office of payment, and this could only be altered by the payee signing the order and sending it to the office of preparation with an application for the issue of a new order payable to himself or anyone named by him at some specified office. A new order was issued, but a second commission was charged for this service. Money orders lapsed at the end of the month following that of issue, but were still payable for two months after lapsing if a second commission was paid; upon the expiry of that period they were forfeited to Government.
Certain special conditions with respect to money orders were (1) that not more than four could be issued to the same person by the same remitter in one day, except under special permission from the Compiler of Post Office Accounts, and (2) that under special orders the issue of money orders could be refused by any post office. Foreign money orders were granted on the United Kingdom, Canada, Germany, Belgium, Luxemburg, Heligoland, the Netherlands, Switzerland, Denmark and Italy. The maximum amount was £10, and the rates of commission were: