The basic function of a commercial bank is that it acts as a financial intermediary between borrower and lender. To the lender it offers a place of safe deposit where interest can be earned, while providing loans and credits to the borrower. By using a bank the borrower and lender do not have to know each other personally, and the bank itself incurs much of the risk involved in making a loan. A bank is able to employ specialist staff, building up a great deal of expertise over time. The resultant economies of scale enable it to make a contribution to economic welfare by ensuring the wider dispersal and utilisation of savings. A bank will have its own proprietors 'capital , of course, and this, too, can be lent to borrowers. But for the great majority of banks, even in the nineteenth century, proprietors' capital provided but a small proportion of the funds available for bank loans. Fundamentally, nineteenth-century banks (as now) lent other people's money, not their own. Thus, the modern British banking system is a ‘fractional reserve system' in the sense that, of the funds attracted from depositors only a very small percentage is retained in the form of cash, the rest is passed on to borrowers. In essence, this was the case throughout the nineteenth century, too: the UK had already developed the ‘fractional reserve system' by 1826.