What is a passbook savings account?

A passbook savings account is characterized by providing the depositor with a physical booklet in which all transactions are recorded. This type of account allows the account holder to track deposits, withdrawals, and interest accrual over time directly in the booklet, which serves as a personal record of the account. Such accounts are often seen as traditional savings accounts and can offer a simple way for individuals to manage their savings without the complexities associated with some modern financial products.

In the context of the other options, an online savings account typically does not provide a physical passbook; instead, it relies on digital statements and online access. An investment account is designed for the purpose of generating higher returns through various investment vehicles, which differs significantly from the basic saving feature of a passbook account. Lastly, while there may be some limitations on access to funds in a passbook account, it is not specifically defined by limited access; rather, it is more about the method of transaction recording. Therefore, the defining characteristic of a passbook savings account is the provision of a booklet for transaction records.