THE POSTAL SAVINGS BANK ACT 
31 
istration and less open to mistakes and to fraud. 13 
After considerable discussion of the comparative 
merits of these plans, Congress decided to leave 
the decision of this question to the Board of 
Trustees. 14 
Rate of Interest 
The question of the rate of interest to be al 
lowed to depositors resolved itself into two ques 
tions : How should the rate of interest be deter 
mined and what rate should be adopted? 
Taking up these questions in their order, it 
may be noted that, while in most countries the 
rate is fixed by law, in some, as for example in 
Italy, in Tasmania and in the Orange River 
Colony, the rate is fixed by administrative author 
ity and varies from time to time according to the 
earnings realized on the postal savings banks’ in 
vestments. Hamilton, 15 commenting upon the 
Italian method, says: “In fixing the rate of in 
terest to be paid to depositors, the Italian Gov 
ernment has followed the true principle of sav 
ings bank management, that is, the rate is not 
13 It was also advocated on the ground that certificates 
ttdght serve as a medium of exchange in times of panic and 
give greater elasticity to our currency. Cf. Albany Law 
Journal, LXX, pp. 346, 349. 
14 Postal Savings Bank act, sec. 5. 
Savings and Savings Institutions, p. 370.