Purchase of this book includes free trial access to www.million-books.com where you can read more than a million books for free. This is an OCR edition with typos. Excerpt from book: Chapter III. THE BANKING BUSINESS IN ENGLAND AND SCOTLAND. (A) ENGLISH ARRANGEMENTS. The general nature of the business done by the English banks consists as elsewhere in taking care of money for one set of customers and lending it to another, a certain proportion being held in cash or invested in marketable securities. In England the bankers are also the chief creators of currency, since by means of the loans that they make in the form of advances and discounts they create deposits for themselves and one another against which the checks are drawn which form by far the most important part of English currency. As a rule it may be said that whatever be the class of community for which each bank or banking branch is providing facilities, the customers to whom it lends will be chiefly the producing and mercantile classes, and the customers for whom it takes care of money will be the investing classes, that is, the professional, land-owning, and propertied classes, though it will also hold the current balances of the producers and distributors, who are as a rule the most important borrowers. Owing to the rapid extension of banking by branches, the business in England has lately been democratized to a very remarkable extent. Not many years ago some banks deprecated the drawing of checks by their customersfor a smaller amount than £5; nowadays the check is frequently used for the settlement of the smallest retail transaction, and is even drawn for sums smaller than £1. By this development, the alleged advantage of the Scottish banking system, which provides its customers with a credit instrument in the shape of the £1 note, has been largely done away with, since the flexibility and adaptability of the check give it obvious advantages. The business done by the English ba...