Money in Classical Antiquity (Key Themes in Ancient History) by Sitta von Reden

Author:Sitta von Reden [Reden, Sitta von]
Language: eng
Format: epub
ISBN: 9781139780308
Publisher: Cambridge University Press
Published: 2010-11-18T00:00:00+00:00

Banking

Banks through their functions of both exchanging and testing coins and providing credit lubricated the flow of cash. Once again, most scholars have discussed ancient banks against the commercial background of modern and early modern European banking, thereby obscuring the particular functions of ancient banks. Ancient bankers fulfilled multiple tasks. They exchanged and tested coins for a fee, took money, valuables and legal documents in deposit, and discharged from, as well as accepting payments to, monetary deposits. They extended and mediated loans, most likely by means of money they borrowed themselves. In Rome, they also mediated the transfer of money from buyer to seller on the occasion of auctions, and in both this and other contexts extended loans against either a pledge or written contract. 70 There may have been further banking services of which we do not know. Conversely, not all banks provided all the services just outlined. Some were specialized in money changing, others in the management of deposits and credit, yet others were present when auctions were held. In Egypt royal banks (basilikai trapezai), which were part of the administration rather than private organizations, stored tax money, managed the accounts of tax-collectors and tax-farmers, as well as keeping safe all tax-farming contracts. In the early republic public bankers (quinqueviri mensarii, tresviri mensarii) were appointed to deal with emergency situations. Whether the different tasks of banks were as neatly distributed among different types of banks, as Jean Andreau has suggested, is open to question. 71 In Egypt, there are clear indications that some functions of banks overlapped, while others were exclusive to one particular kind of bank. 72

Banks differ from private creditors in so far as they take funds on deposit for the purpose of making payments to, and accepting them from, third parties. The question of what else ancient bankers were entitled to do with the deposits of their clients is crucial to the question of their economic power. Possibly, bankers were authorized to make loans from any deposit entrusted to them. But more likely, they could lend out only those for which they paid interest themselves. 73 In other words, bankers enjoyed no advantage over other creditors who used their own wealth to advance loans. Quite the contrary in fact; because bankers were normally of moderate to reasonable social and economic standing, their major function was to support the business of people equal to their own standing. It has been asked how bankers could compete against private creditors if they had to pay interest for the money they lent. 74 Considering the transaction costs of private lending and borrowing (finding a trustworthy lender or borrower, mediating and recalling loans, etc.), and the advantage of the reputation, trust and professional skill of a banker, these advantages justified the costs of higher interest rates. Herein lay the major role of ancient bankers in the competitive world of ancient credit.

The limited role of bankers in maritime finance adds to the impression that the major function of bankers lay in the provision of a greater degree of security in depositing, transferring and lending money.

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