Regulation of the Money Order Industry

Following the recent failure of a large issuer of money orders, several proposals were advanced for additional regulation of the industry. Attempts to evaluate such proposals were handicapped by a nearly total lack of data on the economics of the industry. The authors of this paper conducted a surve...

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Bibliographic Details
Published inFinancial management Vol. 9; no. 4; pp. 13 - 20
Main Authors Horvitz, Paul M., Harper, Charles P.
Format Journal Article
LanguageEnglish
Published Albany, N.Y Financial Management Association 01.12.1980
Financial Management Association International
Blackwell Publishing Ltd
Subjects
Banking industry
Banking regulation
Commercial banks
Consumer protection
Consumer protection regulation
Customers
Fees
Fees & charges
Industrial regulation
Industry
Insurance regulation
Money
Money orders
Orders
Regulation
Sales
State regulation
Statistical data
Travelers checks
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Summary:Following the recent failure of a large issuer of money orders, several proposals were advanced for additional regulation of the industry. Attempts to evaluate such proposals were handicapped by a nearly total lack of data on the economics of the industry. The authors of this paper conducted a survey of major issuers that confirmed the highest estimates of the size of the industry, finding that the business generates profits representing a small return on sales but a relatively high return on investment. After analyzing several of the proposals for additional regulation, the paper concludes that such regulation would not benefit the majority of money order users.
ISSN:0046-3892
1755-053X
DOI:10.2307/3664914