Banking

• Humans are the only creatures that use money.
• Animals and birds and insects and fishes and plants exist together in the world without it.
• In human societies, the earning and spending of money has become one of the most important ways we connect with one another.
• We need to get enough coming in to match what we need to pay out.
• In the earlier stages of human civilization, to satisfy man needs, barter system took place.
• After that with the passage of time, humans used so many other ways of satisfying its needs and wants which led to various stages of use of money as a medium of exchange.
• Commodity money is a large number of commodities or items that have served as commodity money at different time and places.
• Metallic money is a stage in the evolution of money where metallic coins were used as a medium of exchange.
• Paper money is a stage in the evolution of money where paper money was used as a medium of exchange.
• Credit money is a stage in the evolution of money where credit money was used as a medium of exchange.
• Electronic money is a stage in the evolution of money where electronic money was used as a medium of exchange.
• The money came into being from different stages in different time periods.
• Commodity money includes a large number of commodities or items like goats, horses, cows, sheep, etc and other precious items that were used as money.
• Metallic money includes the use of some precious metals like gold, silver as a medium of exchange.
• Coins are a form of money where metal was made into coins of pre-determined (pre-decided) weight.
• Full bodied coins have a face value that is equal to the intrinsic value of the coin.
• Token coins have a face value that is greater than the intrinsic value of the coin.
• Money provides the service of reducing transaction cost, namely the double coincidence of wants.
• When money isn't there, the economy becomes ineffective; on the other hand, efficient money utilization leads to increased productivity and wealth.
• The drawback of paper currency is that payment in large amount is difficult to count and it is also difficult to carry a huge amount of paper currency from one place to another, which are overcome by the use of credit or bank money.
• Money originates in the form of a commodity, having a physical property to be adopted by market participants as a medium of exchange.
• In the late 17th century, convertible paper money was issued on a large scale by a wide variety of institutions by almost all the developed countries of the world.
• Check is not a legal tender because it is not money by itself and can not be enforced in payment of debt.
• Iran also made some unsuccessful use of paper money in their economy in the middle of the 13th century.
• Money is central to the study of economics, and money is closely linked to finance.
• These instruments were accepted on the basis of actual money deposited in the bank.
• Money is an economic unit that functions as a generally recognized medium of exchange for transactional purposes in an economy.
• Paper currency has the advantage that it is lighter than coins.
• Paper currency is legal tender by the state.
• With the introduction of banking system, credit or bank money was introduced in the economic sphere of life, which brought about an easier and modern system of payment in transactions in terms of credit money.
• Paper Money was the next development in the payment and transaction system after metallic money, including currency notes issued by the central bank of country.
• In most of the developed countries, most of the businesses are done through credit money.
• Some Economists believe that paper money was originated from China, as the Chinese were the inventors of paper in the 9th century.
• From the middle of the 8th century to the middle of the 17th century, the Chinese emperor and the Mongols made an extensive use of paper money.
• With the development of computers and advanced communication technology, transactions became easier and new ways of payments and receipts for transactions were introduced such as, ATM cards, credit cards, which are known as electronic or plastic money.
• The bank's capital is the difference between its assets and liabilities.