Bank – Concept, origin, types and products offered

We explain what a bank is and how these financial institutions came into being. Also, the products it offers and the types of banks.

The bank seeks to attract customers who deposit their money there.

What is a bank?

A bank is a financial institution included in the category of companies. Its main function and reason for existence is to attract customers who deposit their money there and through these deposits to be able to make loans to third parties and include other services.

How did the banks come about?

The banks became the main lenders of the crowns.

The first bank transactions are sent to Babylon and Greece, in times before Christ. In the latter territory, reference is made to the so-called trapezitas, who were people who were engaged in all kinds of commercial activities. Even so, the most important banking centers of the Ancient Age were the temples, which were in charge of the religious authorities. However, at this time, the negotiations were carried out through bartering, mostly.

There would not be a more formal emergence of these institutions until the Crusades, since they would promote an imperious need to move sums of money from one territory to another quickly. This was carried out by signing documents that could redeemed for the corresponding amount in another branch.

Let us remember that, during this period, the church dominated large tracts of land, managing to obtain enormous amounts of money from donations that flowed from all European points, taxes and rents. In addition, with the monetary differences, the exchange rate was also encouraged.

The first banks as such were founded in Italy, in its main cities, with the precedent that this country was an important financial and commercial center, as well as being the seat of the Vatican.

Choosing “Bank” as the name of these entities it corresponds to the fact that the first transactions were carried out on these elements. Its growth, almost at the end of the Crusades, was due to the fact that banks became the main lenders of the crowns, especially from France.

What financial products do you offer?

  • Current accounts
  • Savings accounts
  • Fixed terms offering an interest
  • Transactions
  • Extractions
  • Money deposits or checks
  • Credit accounts (through cards)
  • Cash Loans / Credits
  • Redemption of points
  • Exchange, purchase and sale of currencies

Types of banks

The public bank is fully managed by the state.
  • Public. Managed by the State. Example: Central Bank of the Argentine Republic.
  • Private. Managed by individuals. Example: HSBC Bank.
  • Mixed. Managed by the State and by individuals. Both people are shareholders.
  • Specialized. They cover a specific item. For example, rural or industrial banks.
  • Centrals. They have a higher hierarchy than the rest of the banks, since they authorize the operation of these and regulate them.
  • Broadcast. They issue the currency in a country. Generally, this activity is carried out by the Public Bank.
  • Second floor. They are a financial means through which resources are redirected to certain economic areas to be developed.