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Published July 7, 2023
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What Is a Money Order?

A money order is a safe alternative to cash or personal cheques. Money orders can be purchased at banks, credit unions and Canada Post locations.

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A money order is a paper document that acts as a form of payment, much like a cheque. Unlike a personal cheque, however, a money order is guaranteed because the amount is prepaid by the purchaser.

A money order can come in handy when a cheque is not an acceptable form of payment or when you want to send funds through the mail but don’t want to risk sending cash.

Money orders can also be an especially good payment option for people who don’t have a bank account and therefore don’t have access to cheques or Interac e-transfers.

How money orders work in Canada

Paying with a money order

To use a money order as payment, you’ll first need to purchase it. That means you’ll need access to funds that will cover the full amount of the money order, plus any service fees. Note that Canada Post and some financial institutions have a limit of less than $1,000 per money order.

You’ll need to provide your name and possibly some official government ID, as well as the name of the person who will receive the money order (the payee). None of your financial information is displayed on the document, though it will have security features like a serial number, polarized ink and a special code for the financial institution or post office cashing the money order to ensure it’s valid.

Once the money order is given or mailed to the payee, they’ll need to go to a post office or bank to redeem it for cash.

Accepting a money order as payment

When you receive a money order, you need to go to a post office or bank to cash it. You will be required to show ID to prove that you’re the intended recipient.

It’s important to note that while money orders are generally secure forms of payment, they can be counterfeited. If you sell something online or in person and accept money orders as a form of payment, you may want to ensure the money order can be cashed before finalizing the sale.

Where to get a money order in Canada

Many people get money orders from the financial institution where they bank. Due to the popularity of Interac e-transfer payments, money orders are less commonly offered by banks and credit unions, though some still provide them.

Canada Post also offers money orders and is a good option for people without a bank account.

Be aware that some money order providers will charge a fee for the service.

Some examples of where to get a money order and how much it will cost:

  • Canada Post: $8.50 fee
  • Canadian Imperial Bank of Commerce: $9.95 fee
  • TD Bank: $9.95

How to send a money order

To send a money order, you will generally have to go in person to a bank or post office outlet. You should bring a government-issued ID (though you may not be asked for it). At Canada Post, you’ll be asked for ID if you’re purchasing multiple money orders that exceed a total of $3,000).

You will also need the name of the person you’re sending the money order to. For security, only the person whose name is indicated on the money order will be able to cash it. You’ll need to pay with a debit card or cash if you get a money order at a Canada Post outlet. At a bank, you could pay with funds from your account. You can’t buy a money order with a credit card.

You’ll get a receipt for your money order. It’s important to hold onto this receipt, as it contains a serial number and code that you’ll need to reference if you require a refund. Some financial institutions may allow you to track your money order online or via your phone.

Pros and cons of money orders


  • Doesn’t require a bank account.
  • Safe to send through the mail.
  • Doesn’t require you to share your bank account numbers.
  • Refundable if it has not been cashed.


  • May be limited to a maximum of $1,000 per money order.
  • Can be counterfeited.
  • May only be available in a limited number of currencies.
  • You may pay around $10 in fees to purchase a money order.

When a money order makes sense

A money order is a good option for people who don’t have access to a chequing account or traditional banking services. It is also a safe alternative to cash when sending payments through the mail.

Alternatives to money orders

Bank draft: A bank draft is a physical form of payment that is guaranteed by the bank. There is no amount limit, so people tend to use bank drafts to make large purchases, such as when buying a house or car. Fees are comparable to those for money orders.

Certified cheque: If you have a chequing account, you can choose to send a certified cheque. Your financial institution will verify that you have the funds and guarantee payment. However, this option may not be practical, because it can be more expensive than a money order and many banks no longer offer it.

Electronic transfer: Depending on the amount you want to send and the destination, a money transfer can be a fast and secure option. If you have a bank account, Interac e-transfers are ideal for money transfers within Canada and may be free, depending on your financial institution. However, there are limits on how much you can send each day, week and month. You could also send money overseas with an international money transfer or wire transfer.


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