them were now enabled to
supply Cromwell with money in advance on the revenues as his occasion
required, upon great advantage to themselves."

The Bank of England, as stated before, was incorporated by the act of 1694.
The position of the other banks at that time was defined by that act and
the act of 1697, which declared that no bank, that is, no joint-stock bank,
was "to be established within England during the continuance of the Bank of
England," and also by the act of 1708, which provided that "during the
continuance of the Bank of England, no company or partnership exceeding six
persons in England" should "borrow, owe or take up any sum or sums of money
on their bills or notes payable on demand or at any less time than six
months from the borrowing thereof." This was confirmed by the act of 1800.
No change of importance was made till the act of 1826, which prohibited
"bank notes under L5," and the second Banking Act of that year which
allowed the establishment of co-partnerships of more than six persons,
which necessarily were joint-stock companies, beyond 65 m. from London. The
act of 1833 allowed the establishment of joint-stock banks within the 65 m.
limit, and took away various restrictions of the amounts of notes for less
than L50. But the power of issuing notes was not allowed to joint-stock
banks within the 65 m. radius.

In the early days in England, issuing notes formed, as Bagehot says in his
_Lombard Street_, the introduction to the system of deposit-banking--so
much so, that a bank which had not the power of issuing notes could
scarcely exist out of London.

[Sidenote: Bank notes.]

Bank notes in England originated in goldsmiths' notes. Goldsmiths received
deposits of moneys and gave notes or receipts for such moneys payable on
demand. The London bankers continued to give their customers notes or
deposit-receipts for the sums left by them until about 1781, when in lieu
of such notes they gave them books of cheques. Before the invention of
cheque-books, the practice of issuing notes was considered so essentially
the main feature of banking, that a prohibition of issue was considered an
effectual bar against banking. Accordingly the prohibitory clause in the
act of 6 Anne, c. 50, 1707 (in Record edition), which was repeated in the
Bank of England Act 1708, 7 Anne, c. 30, s. 66 (in Record edition),
prohibiting more than six persons from issuing promissory notes, was
intended to prevent any bank being f