debt#. A banker usually carries on three or four
different kinds of work, but his proper work is that of borrowing from
persons who have ready money to lend, and lending it to those who want
to buy goods. As a shopkeeper sells his stock of goods, he receives
money for it. And, until he buys a new stock, he has no immediate need
of this money. Those, again, who receive salaries, dividends, rents, or
other payments once a quarter, do not usually want to spend the whole at
once. Instead of keeping such money in a house, where it pays no
interest and is liable to be stolen, lost, or burnt, it is much better
to deposit it with a banker, that is, to lend it to a banker who will
undertake to pay it back when it is wanted. Generally speaking a
merchant, manufacturer, or tradesman sends to his banker every day the
money which he has received, and only keeps a few pounds to give change
or make petty payments. The advantages of thus depositing money with the
banker are chiefly as follows:--

(1.) The money is safe, as the banker provides strong rooms, locked and
guarded at night.

(2.) It is easy to pay the money away by means of cheques or written
orders entitling the persons named therein to demand a specified sum of
money from the banker.

(3.) The banker usually allows some interest for the money in his care.

Bankers receive deposits on various terms; sometimes the depositor
engages to give seven days' notice before withdrawing his deposit; in
other cases the money is lent to the banker for one, three, or six
months certain, and the longer the time for which it is lent the better
the rate of interest the banker can usually give. But a great deal of
money is deposited #on current account#, that is, the customer puts his
money into the bank, and draws it out just when he likes, without
notice. In this case the banker gives very little interest, or none at
all, because he has to keep much of the money ready for his customers,
not knowing when it will be wanted.

Nevertheless, while some depositors are drawing their money out, others
will be putting more in, and it is exceedingly unlikely that all the
thousands of customers of a large bank will want their deposits at the
same time. Thus it happens that the banker, in addition to his own
capital, has a large stock of money always on hand, and he makes profit
by lending out this money to other customers, who need credit.

There are various ways in which a banker arranges his