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Historical evolution of banking

It is very difficult to say the historical evolution of Bank. But it is sure that the development of Bank is performed step by step. From the view of a specialist we can say- “The birth of present day banking is not sudden; it has come to its present stage through a process of development.”
Historical evolution of Bank are discussed as follows-

1. Introduction of money & Bank: To solve the problems of product transaction, money was invented. Someone believes that in 5000 B.C in Greece, Roam and Egypt introduction of money is performed and banking function was started. According to Smith- “Money is the mother of Bank and banks are the reformer of money.” Inventing money the rich person deposited their extra money to the priests and the priests used those money to lend. By which, deposition & lending of money is originated and banking system was started.

2. Evolution of Civilization & Bank: Evolution of civilization contributes on the development of bank in different places of the world. The relation between the civilization and development of bank is as follows-

a. Civilization of Shindhu (5000-2000 B.C): People of Shindhu made more profit after the invention of money. They then used to deposit money and give loan to others like a bank.

b. Babnylonian civilization (2000 B.C): In Babilian the rich people deposited their extra money to the priests. And the priests used the deposited money to give loan like a bank. This indicates the development of banking.

c. Baidik civilization (2000-1000 B.C): In the holy “Bedth” of hindu it’s stated the facts of histories of loan & interest. From this the development of banking is assumed.

d. Roman civilization (1000 B.C): In this period the businessman came together to Roam for trade. By their transaction cheque and Bank draft are introduced.

e. Civilization of china (600 B.C): With the increasing of deposition, loaning and transaction “Shansi Bank” was established as an institution.

f. Greek civilization (400 B.C): Based on religious institution deposition, loan and transactions are performed which developed the banking system.

g. Egyptian Civilization: Here banking system is developed by the financial transaction of general people.

3. Ancestors and bank: The present day bankers have three ancestors ‘Goldsmith’, ‘Merchant’, and ‘Money-Lender’. A modern bank is something of there. The contributions of these ancestors are as follows-

  • Goldsmith: As goldsmiths were rich and honorable people deposited their money to the goldsmith and they provided loan from the money. At first they introduced “drawing slip” and “deposit slip.”
  • Merchant: Merchants were also rich. For the faith on them people used them as a media of transferring money. Travel cheque is introduced by merchants.
  • Money-Lenders: Money lenders are the owner of huge property. By deposition and lending money they contributed to the development of banking system.

4. Modern Banking: Modern Banking is introduced in Europe. It consists of computerized banking, online banking etc.

In conclusion it may be said that the banking system which is started by the introduction of money is now termed into online banking and is developing more and more.