Evolution of Commercial Banking

The origin and genesis of commercial baking can be traced back to before Christ. Infect there was one fundamental desire that paved the way for the development of commercial banking and that was the desire for credit.

The granting of the credit began thousands of years ago. In Babylon credit was given about 2000 B.C.
Dr. Crowther writes in his famous "An outline of Money"
"The present day bankers have three ancestors namely merchants, moneylenders and goldsmiths. A modern bank is something of each of these. It is said that money has no properties, it is flat so that it can be piled up and it is round so that it can circulate. The progeny of moneylenders is concerned with flat money, piled up money and savings. The progeny of goldsmith is concerned with round money, circulating money and cash."

The history of banking is closely related to the history of money. As monetary payment became important, people looked for ways to safely store their money. As trade grew, merchants looked for ways of borrowing money to fund expeditions. From the above it is clear that moneylenders, goldsmiths and merchants__ all contributed in the evolution of Commercial Banking.