From barter to money creation, check out the evolution of the banking system
Can you imagine a world without banknotes, coins, ATMs - and even without access to banks through the internet? Because we have not always had so much ease, technology and even security at our disposal. Thus, from the exchange of goods, through the emergence of currency units, how about giving a brief history of the evolution of the banking system?
In ancient times, thousands of years ago, before "money" existed, whether in the form of coins, banknotes, or documents that secured credit, business transactions took place through the exchange of goods - or the famous barter.
This method was more than sufficient for the cultures of the time. However, as societies evolved and became more complex, the need arose for a more efficient and stable trading system to be developed.
This is how the concept of “currency” arose, that is, something whose value was based on — and equal to — the cost of the material from which it was produced. From then on, coins came into circulation and revolutionized the way trade was done around the world.
The first variety of currency appeared in Mesopotamia around the year 3000 BC. Called shekel, this currency also served as a unit of measure and was used both to determine the weight of barley (each shekel was just over 11 grams or about 180 grams). grain grains) as the weight equivalent of certain metals such as copper and bronze, for example.
The Mesopotamians relied on this system to develop their economy - and the Babylonians, as well as other city-states of the time, also drew upon it to elaborate on a range of concepts, such as lending, debt, legal contract, business practices, and private property.
After that, around the year 700 BC, the first silver coins appeared in Greece and the gold coins around 390 BC in Macedonia - and these even came with figures minted on one side! Already the first paper notes began to be used in China during the Song Dynasty, early in the 7th century.
The curious thing is that the concept of "bank" came even before the coins. Also originating in Mesopotamia, the idea arose from ancient royal palaces and religious temples that offered a safe place of storage for grain and other commodities.
The Mesopotamians kept everything under control through receipts and documents that served as records for transactions. It was not long before private houses were involved in this type of operation and a series of laws were drafted to regulate the activity. Interestingly, in ancient Egypt the centralization of harvests in state-owned warehouses also led to the development of a similar banking system.
In the land of the pharaohs, those who “deposited” their goods in the royal warehouses received proof of the transaction that recorded the value of what had been left to the state. For military and international negotiations, it was often the case that operations were made with precious metals - and in ancient Roman times the use of grain was completely replaced by that of metals.
Indeed, the development of human civilization is closely linked to the emergence of banking systems. And as time went by and as trade grew around the world, currencies were being standardized and new ways of dealing with foreign currency units were being established - giving rise also to bureaux de change.
With the decline of the Roman Empire, banking systems virtually disappeared amid barbarian invasions. The ensuing chaos plunged Europe into a period known as the Dark Ages - and it took several centuries for the economy and trade to stabilize again.
Then, during the Middle Ages and early Renaissance, as international trade gained momentum, the need to store and transfer money also resurfaced. Thus, several financial services began to appear, primarily in Italy - the oldest historical record in existence dates from 1156 and refers to the repayment of a loan that two Genoese made to bank agents in Constantinople.
It was during the Middle Ages that banks began to emerge in various parts of Europe, especially in France and England. Besides trade, another great motivator for their appearance was the Crusades.
The battles fought in foreign lands gave rise to the need to transfer sums of money for equipment and supplies - and the Knights Templar, inspired by the Italian banking model, created one of the most powerful financial organizations in the medieval era.
Interestingly enough, as interest on loans was prohibited by the Church, as it constituted the sin of usury, banking was almost exclusively conducted by the Jewish community, which had no religious restrictions on such activity. . But interest was an important part of the process, so ...
Later, in the 16th century, the Protestant Reformation overturned that "silly" rule of interest charges, marking the division between the earlier model, largely controlled by religious institutions, and the birth of capitalism. Since then, banking systems have undergone immense modernization, and bankers of the past would surely be amazed at the facilities we have today.
Banking revolution
Imagine the ancient Mesopotamians, the Templars, or the ancient Jewish bankers discovering that we don't even have to go to the branches to do most of our operations, that we live in a financially interconnected world, and that we are heading for a future in which physical money will be spent. retired, giving way to virtual coins!
In addition, advances in security and the emergence of innovative technologies continue to occur, and one institution that is constantly investing in new tools is Santander. Just this month, the bank started its first solution development marathon, called “The Code Force”, which has three stages.
You can check out the full details of the event at this link, but basically the initiative is meant to stimulate and gather new ideas from developers, designers, finance and business experts, and has already selected four finalist teams that will move on to the next phase of the event. competition.
The teams are focused on developing virtual currency-related projects and solutions to make life easier for customers and merchants when making and receiving payments. In addition, the groups are also working on financial projects involving the Internet of Things and machine learning.
The winners will be announced in January and will receive sponsorship of $ 25, 000 to make their project viable, as well as the possibility of being hired by the bank itself or be its suppliers. Want to know more about the teams and their projects? Be sure to visit the site to find out how this gang plans to make your financial life better and safer.
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* This is an advertising sponsored by Santander.
