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History Banking Activities Types of Banks References: The Bank of England, Established in 1694

A bank is a financial institution where customers can save or borrow money. Banks regulate money through laws set by governments. Banks accept deposits from customers, provide loans to customers, and invest money to earn more. There are different types of banks such as commercial banks that deal with the public, investment banks that deal with financial markets, and central banks that regulate a country's money supply and interest rates.

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97 views

History Banking Activities Types of Banks References: The Bank of England, Established in 1694

A bank is a financial institution where customers can save or borrow money. Banks regulate money through laws set by governments. Banks accept deposits from customers, provide loans to customers, and invest money to earn more. There are different types of banks such as commercial banks that deal with the public, investment banks that deal with financial markets, and central banks that regulate a country's money supply and interest rates.

Uploaded by

Karam Al-Mashhadi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Bank

A bank is a financial institution where customers can save or borrow


money. Banks also invest money to build up their reserve of money.
What they do is regulated by laws. Those laws differ in different
countries. The people who work at a bank are called bank employees.
Certain banks deal directly with the public and they are the only ones
which an ordinary person will deal with. Other banks deal with
investments and international currency trading.

Customer's money may be placed in the bank for safe keeping. Banks
may give loans to customers under an agreement to pay the money
back to the bank at a later time, with interest. An example is getting a The Bank of England, established in
mortgage to buy a house or apartment. Banks also can use the money 1694.
they have from deposit accounts to invest in businesses in order to
make more money.

In most countries the rules for banks are made by the government acting through laws. A central bank (such as
the Bank of England) adjusts how much money is issued at a particular time. This is a factor in the economy of
a country, and the government takes the big decisions. These "banks of issue" take in, and issue out, coins and
banknotes.

Contents
History
Banking activities
Types of banks
References

History
The word bank comes from an Italian word banco, meaning a bench, since Italian merchants in the
Renaissance made deals to borrow and lend money beside a bench. They placed the money on that bench.

Elementary financial records are known from the beginning of history.[1] Baked clay records were done before
the invention of writing.[2]

In the 17th century, merchants started storing their gold with goldsmiths in London. The goldsmiths had their
own vaults, and charged a fee for storing the merchants' gold. The goldsmiths eventually started loaning
money using the gold left to them, and also paid interest on the gold.

The Bank of England began issuing banknotes in 1695. The oldest bank still in existence is Monte dei Paschi
di Siena in Siena, Italy, which started in 1472.

Banking activities
A bank usually provides the following services:

Checking account
Cheque books
Savings account
Money market account
Certificate of deposit (CD)
Individual retirement account (IRA)
Credit card
Debit card
Mortgage
Mutual fund
Personal loan
Time deposit
Automated teller machine
Transactional account

Types of banks
Community development bank: regulated banks that provide financial services and credit to
under-served markets or populations.
Land development bank: The special banks providing long term loans are called land
development banks, in the short, LDB. The history of LDB is quite old. The first LDB was
started at Jhang in Punjab in 1920. The main objective of the LDBs are to promote the
development of land, agriculture and increase the agricultural production. The LDBs provide
long-term finance to members directly through their branches.
Credit union or Co-operative bank: not-for-profit cooperatives owned by the depositors and
often offering rates more favorable than for-profit banks. Typically, membership is restricted to
employees of a particular company, residents of a defined area, members of a certain union or
religious organizations, and their immediate families.
Postal savings: savings banks associated with national postal systems.
Offshore bank: banks located in jurisdictions with low taxation and regulation. Many offshore
banks are essentially private banks.
Savings bank: focuses on accepting savings deposits and paying interest on deposists.
Building society and Landesbanks: institutions that conduct retail banking.
A Direct or internet-only bank is a banking operation without any physical bank branches,
conceived and implemented wholly with networked computers.

References
1. Mesopotamia of 8000 BC.
2. Davies G. & Bank J.H. 2002. A history of money: from ancient times to the present day.
University of Wales Press.

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This page was last changed on 3 May 2020, at 06:26.


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