ABSTRACT
The antecedents of modern banking appear to be the activities of goldsmiths in seventeenth-century England *who, of necessity requiring strongrooms to hold the materials of their trade, found that they were able to rent out the excess space for the safekeeping of money and other valuables. From the provision of this facility there developed the practice of customers depositing money in return for a receipt or certificate of deposit, and gradually not requiring the identical coin they had left but merely coin of equal value. In practical terms the goldsmiths assumed ownership of the coin on deposit and employed it, but they always held sufficient to convert certificates of deposit on demand. From this beginning of deposit-taking, the goldsmiths next began the practice of chequing when they enabled a merchant who wished to pay another merchant to write an order to his goldsmith asking for the transfer of money from his account to that of his creditor without having his deposit certificate converted into coin.
