What is a Bank, The First Banks that Existed?
The Definition of The Bank
The bank is an organization that gets an approval from governmental authorities; and that’s because of accepting the financial deposits, the payments of cheeks, the applying for loans for different people and companies and foundations,
The bank is known that it’s an organization that provides for persons and foundations and companies to invest their money in the banks. And it is known also for exchanging and changing money and sending and receiving money as well.
The History of Banks
The historical resources indicate to the foundation of banks the foundation of it came from the Babylonian Era” the opinions say the first bank was founded in the city of Eibar which is close to (Euphrates River) there is another opinion indicates to the existence of banks came from the Greek age.
The bank started to spread as soon as they invented fiat money; so the first form for these banks was a shop that used to buy and sell currencies, the first commercial bank was founded in (1517AD) in “Venice” and later on they founded a bank in the city of (Amsterdam) in (1609Ad) then the banks spread all over the world.
Since the 18th century the numbers of banks started to become more and in many different countries, through the 20th century the banks had many challenges, all of them were characterized by development in magazines and the banks were getting a good process.
Types of Banks
The development that the banks saw, it contributed in getting a lot of special types of them, and each type of it is specialized in a specific type of banking business, as each type of the of banks is characterized by many characteristics.
These banks are concerned in offering banking services to the government, it has an important place in the cash market, the central banks are the foundation of the banking system, and they are different than the commercial banks
Because its main goal is not to make a huge profit, but they offer services for economic environment, one of the important processes of central banks is they issue money whether it’s fiat or metal
Commercial banks are the foundations that are concerned with getting deposits of the individuals, and this is in return for providing the ability to withdraw it whenever it’s needed; that’s why these banks deal with short-term credits
Banking foundation is not going to be considered as commercial banks if it does not provide the potential of accepting withdrawing the financial deposits, as they deal with all the financial assets only.
Investment banks are the banks that are characterized by their special processes or developing the fixed capitals, such as real estates and factories and agricultural lands, so all of its processes depend on Non-withdrawable money.
And time deposits and borrowing money from others for a specific period in return for securities that’s similar to time deposits