The word “bank
is derived from the word “Bancus or
Banque”, that is bench. Jews, who were considered to be the early
bankers, transacted their business on benches in the market. Some people trace
the origin of the word “bank” from the German word “Back” meaning a joint stock fund. This seems to be better.
Early History Of Banking
According to
history, Babylonians had developed as banking system. The great temples were
powerful of the Greek banking institutions. In ancient Greece & Rome, the
practice of granting was widely prevalent. People used cheque & drafts to
settle their accounts.
Manu, the
ancient Hindu lawgiver has written exhaustive regulations governing credit. He
talks about credit installments, interest on loans and commercial papers.
During the early
periods, although banking business was mostly done by private individuals, many
countries established in Barcelona
in 1941. During 1407, the bank of Genoa
was established. The bank of Amsterdam
was established in 1609 to meet the needs of the merchants of the city. It
accepted deposits, which could be drawn on demand.
English banking
may correctly be attributed to the London
gold smiths. The received their valuables and fund for safe custody and issued
receipts. These notes, in the course of time, became payable to bearer of
demand and hence enjoyed considerable circulation. However, in the course of
time, gold smiths were ruined. This lead to the growth of private banking and
establishment of “Banking of England” in 1694
