Some Must-Know Facts About Banking In Early Times

Banks are common establishments that you can see in nearly every corner or street in almost all parts of the world. You will be hard-pressed to find a person who has not entered or made a transaction at a bank today.
 

Early Banking Processes And Concepts

Banks and banking operations and solutions have gone a long way from its early beginnings. Concepts, processes, and solutions offered by  banks have evolved, making them more advantageous and interesting for their clients.

Below are some facts worth knowing about banking in earlier times:

• Banking is said to have existed even before the thirteenth century, although there is no adequate documentation to support this. Many of the early “banks” dealt mainly in coin and bullion and much of their business were focused on money-changing and the supply of lawful foreign and domestic coin of the correct weight and fineness.

• During the ancient times, merchant-bankers also started dealing in goods and bills of exchange. This made way for the remittance of money and the payment of accounts at a distance, without shipping any actual coin.

• Another early banking activity was the acceptance of deposits. This usually pertained to either the deposit of money or valuables merely for safekeeping or for transferring to another party or to the deposit of money in a current account. A balance in the current account may also represent the proceeds of a loan granted by the banker. This is usually done through an oral agreement between the parties, recorded in the banker’s journal and the loan will be granted merely by allowing a customer to overdraw his account.

• During the seventeenth century, English bankers began to develop a deposit banking business. The methods used and evolved in England and Scotland were in due course to prove highly influential in other parts of the world. Because of their reputation and wealth, the London goldsmiths started keeping money and other valuables in safe custody for customers. They also began dealing in bullion and foreign exchange and this led to another form of business:  acquiring and sorting coin for profit.

Info source: www.business.hsbc.com