Understanding the Passbook and Account Statement

A passbook is a booklet provided to a bank account holder to record transactions. It serves as a physical record of all credits (deposits) and debits (withdrawals, charges, etc.) that occur in the customer's account.

Who Maintains the Passbook Statement?

The passbook contains the statement of account of the customer. This statement reflects the transactions as recorded by the institution holding the customer's funds and managing the account.

Let's look at the options:

• The customer receives the passbook but does not maintain the official record within it. The customer uses it to track transactions recorded by the bank.
• A business owner might have a bank account and a passbook, but the business owner is the customer, not the entity maintaining the official transaction record within the passbook itself.
• The bank is the financial institution that holds the customer's funds and processes all transactions. Therefore, the bank is responsible for recording these transactions accurately and updating the passbook accordingly when presented by the customer.

The passbook is essentially a copy of the customer's account ledger as maintained by the bank. The entries are made by the bank staff or automated machines based on the transactions processed by the bank.

Why the Bank Maintains the Passbook

The bank maintains the detailed transaction records for each customer account. The passbook serves as a convenient way for the customer to get a physical, up-to-date summary of their account activity and balance, verified and recorded by the bank. It acts as a statement of account provided by the bank to the customer.

Therefore, the passbook, as a statement of the customer's account, is maintained (updated with transaction details) by the bank.