money Order Cost

Other than the convenience factor, if something does contribute to the popularity of the money order system on a large scale, it is the cost. The United States Postal Service (USPS) has been issuing money orders for quite some time now and that too, for a transaction fee as little as US$1.20.
The money order system was introduced by a private firm in Great Britain in 1792 and therefore, its cost was quite high. Over the period, public institutions like the postal services took over, and the cost was slashed by a significant extent. This, in turn, added to its popularity.



One of the most convenient tools of money transfer -- money order is basically a written order for the payment of a stipulated sum of money to a particular individual; a prepaid check which can be cashed at any post office, or a bank.



How Much Does a Money Order Cost?



In the United States, a money order can be purchased from third-party sources, like the post office, or a grocery store. It can be purchased by cash, or debit card payment, and cashed at any post office in the country. Usually the cost of a money order depends on the total sum of money that is to be transferred and the type of money order you want to send (i.e., domestic, or international).



The maximum amount of money that can be transferred by a single money order is US$1,000, but separate money orders amounting to more than US$1,000 can be sent in a single day to cover your financial need. If the total amount to be transferred exceeds US$3,000, a current government-issued identification with a photograph of the sender is required. A processing fee of US$1.20 is charged if the amount one intends to send falls between US$0.01 to US$500.00 and US$1.60 if the amount is anywhere between US$500.01 to US$1,000.00. In case of postal military money orders, which are issued by military facilities, the fee is as little as US$0.35.



As for international money orders, the maximum amount of money that can be transferred by a single money order is US$700. In this case, the processing fee is US$4.50 per unit, and the maximum amount that can be transferred in a single day is US$10,000. The United States Postal Service provides the facility of sending money orders to 29 countries across the world. These include

International money orders can be cashed at various banks and post offices in any of these 29 countries. Each of these have a unique identification number which makes it possible for the sender to keep a track of the money transferred. While the list of countries accepting direct international money order is 29 as of now, the chances of it growing in the near future cannot be ruled out.



According to the Federal Reserve, around 889 million money orders, amounting to a gross transaction volume of US$145 billion, were purchased in the United States in 2005. More importantly, the service is not just restricted to public institutions like the United States Postal Service anymore, but also includes private firms like Wal-Mart and MoneyGram. All these developments show that the veteran of the field has been quite successful in holding its ground and resisting competition from newer methods of money transfers, which are becoming quite popular.

Source: http://www.buzzle.com/articles/money-order-cost.html