Significance of banks in Britain

BANKS IN BRITAIN

Banking started in the 17th century with the first activity done by goldsmiths who after dissolution of English monasteries by Henry VIII, began to accumulate significant stocks of gold. Goldsmiths were known as “keepers of cash”. They accepted gold in exchange for a receipt as well as accepting written instructions to pay back.

Around 1650, a cloth merchant, Thomas Smith opened the first provincial bank in Nottingham. In 1694, Bank of England was founded. The governor and company of the Bank of Scotland were established by an Act of Parliament of Scotland on 17th July, 1695.

The Bank of Scotland was established to support Scottish business and was prohibited to lend to government without parliamentary approval. During the 18th century bank services increased.

An Act of Parliament in 1708 restricted banks with more than 6 partners from issuing bank notes. This was aimed at keeping private banks as small partnerships.

Industrial revolution and growing international trade increased number of banks especially in London. Merchant banks were started even outside London especially in growing industrial and port cities like Manchester, Birmingham, Newcastle and Liverpool.

By 1784, there were more than 100 provincial banks. Currently all banks have refined their services with most offering similar services, with only different interest rates.

The bank regulations have created transparency among stakeholders such as between banking institutions and individuals they conduct business with.

The Islamic Bank of Britain also provides services to Muslims in England following the Sharia Law. Other banks such as Lloyd’s Banking Group, Barclays, Standard Chartered, and Bank of Scotland offer services to the rest of the public. With your money safe in England, why stress about anything?