gencies for the
purpose are the national post-offices. Postal savings banks, or postal
savings systems as divisions of the postal service, are now found in
all the larger countries of the world, and in many smaller ones. The
United States of America was almost the last civilized country to
establish such a system, which was authorized by act of Congress in
1910, and went into operation in a few designated cities in January,
1911. The number of offices at which it was in operation was rapidly
increased, and the number in 1914 was about 10,000.

Any one ten years of age may become a depositor. Deposit must be made
always in multiples of one dollar. Not more than $100 will be accepted
for deposit in any one calendar month, and nothing after the total
balance to the depositor's credit is as much as $1000, exclusive of
accumulated interest. However, amounts less than one dollar may be
saved for deposit by purchasing a ten-cent postal savings card and
affixing ten-cent postal savings stamps until the nine blank spaces
are filled. Such a filled card will be accepted as a deposit of
one dollar either in opening an account or in adding to an existing
account.

Deposits are not entered in a depositor's book, as is the usual
practice of savings banks, but are evidenced by certificates issued in
fixed denominations of $1, $2, $5, $10, $20, $50, and $100. These bear
interest, from the first day of the month next following that in which
the deposit is made, at the rate of 2 per cent per annum for a whole
year (interest is not paid for any fraction of a year). Interest
is not compounded, unless the depositor withdraws the interest and
redeposits it, but simple interest continues to accrue annually on
a certificate so long as it is outstanding, without limitation as to
time.

By the end of the first year (1911) of operation the savings system
held a balance to the credit of depositors of nearly $11,000,000; in
the next year (1912) there was added to this about $17,000,000; in
the next year (1913) about $12,000,000; and this average rate of one
million dollars a month net addition to deposits has continued to the
present (1916). These funds are deposited in banks belonging to the
federal reserve system, which must deposit with the Treasurer of
the United States designated kinds of bonds (national, state, and
municipal) as security and pay interest at the rate of 2-1/2 per
cent on the amount of the deposits. The one-half per cent dif