It is difficult to imagine that the usual, "modern" financial institutions and operations existed for many centuries before our era. About how the system of debt relations appeared and developed in Ancient Greece, in the material of the magazine "Budget".
Usury in Ancient Greece was carried out both by wealthy individuals from among the citizens of the policy, and by the owners of exchange shops (meals), the so-called meals. Among them there were a fairly large number of slaves set free, who played the role of trustees for the true owners of such offices. On the basis of the meals, credit and other services began to develop in the debt market, which, with certain reservations, can be considered banking, and the ancient Greek exchange meals themselves can be considered the forerunners of banks of a later era. By the way, modern banks, originating from the exchange offices of medieval Italy, have gone the same way of development, and the Greek word "meal", translated as "bank" in modern Greek, and the Italian word "bank" mean the same thing - a table or bench of a street money changer.
The activity of Hellenic meals and the very emergence of meals became possible only thanks to the invention in the 7th century BC. e. in the ancient Greek city of Lydia on the territory of Asia Minor, minting of standard gold and silver coins. This invention was quickly taken up by other Greek city-states, leading to the development of international monetary circulation, requiring the exchange of one coin for another in commercial transactions. Ancient Greek banks, if you can call them that, directly grew out of money circulation. Undoubtedly, the ancient Greeks adopted the foundations of the legislation and practice of debt relations from the experience of the more developed civilizations of the Ancient East, primarily Babylonia and its banking houses. They were also familiar with the practice of commercial and maritime lending that existed in the Near East and Near East,with the work of the Babylonian and Phoenician exchange offices, which have remained exchange offices.
However, it was the ancient Greeks who managed to go much further in the development of financial, payment, deposit and credit services as a separate specialized field of activity. Greek food banks form a link between the debt and legal practice of the Ancient East and then the Roman Empire, which spread throughout the Ancient World. The Romans adopted in the ancient Greek colonies of Italy and Sicily the very idea of monetary circulation and the practice of minting coins, the foundations of the legislation regulating the sphere of debt relations, the original form of credit institutions.
The activities of the ancient Greek banks-meals became especially active in the late 5th and early 4th centuries BC. e. and spread to large sections of the population in all Hellenic cities. The main economic function of meals was originally the exchange of money, since each Greek city-state issued its own coin. The exchange was usually charged a commission of 5-6%, but there are cases when it reached 10 and even 25%. Money changers began to turn into the first bankers when they began to make money transfers, began accepting cash deposits for safekeeping and discovered the possibility of using these funds to lend to other clients. For example, the father of the famous Greek orator Demosthenes kept deposits in several banks in the amount of 3 thousand drachmas.
From the deposits provided at the disposal of the meals, and their own money, the working capital of the bank-meal was formed. The largest meals turned into centers of credit operations. Some deposits were interest-free, since the money was transferred to the meal, either for better preservation, or to hide property from taxes. Naturally, they lent at significantly higher interest rates, and this difference accounted for their income. Deposits could be claimed after the expiration of the agreed period or simply as needed. Therefore, in theory, the meal should always have reserve funds in case of unforeseen withdrawal of deposits.
From the end of the 5th century BC. e. accepting deposits and issuing loans on their basis became the main economic function of the first Greek banks-meals. Deposits were accepted at 10%, loans were issued at a higher interest rate - from 10% to 33% in some cases. In the IV century BC. e. 18% was considered a fairly standard rate on loans. Loans were secured by surety, property pledge, and in some cases land pledge.
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On the basis of the exchange and storage of money, over time, a transfer of money arose from the account of one depositor to the account of another. Money transfers, according to the speech of the Athenian orator Isocrates "On meals", should be done only through meals in order to avoid the danger that money may be exposed to during transportation by ship. The operations performed by the Greek meals were numerous, varied, and significant in the scale of Greece.
The most common financial and usurious operation in Athens and other coastal cities of Greece was sea loans, that is, the issuance of money for the implementation of sea trade expeditions on the security of goods or a ship, or, as a rule, both. It happened that sea loans were issued for a very long period necessary for sailing to distant countries where the sale of goods was most profitable. Since traveling by sea, especially during the war, was associated with great risk, lenders demanded very high interest rates. There is evidence of transactions in which the debtor undertakes to pay the creditor 30%, and 10% was considered a fairly low rate. Traveling to the Bosporan Strait (the modern Bosphorus) and back in wartime brought money-lenders 30%, in peacetime - 22.5%. Trade trips by sea were made at least twice a year, so a profit of 100% per annum from sea loans was not uncommon.
Sea loans were issued not only by professional usurers, but also by Athenians living in Athens by foreigners. This was also done by merchants, former merchants who had accumulated capital, persons specially devoted to credit operations, including bankers-meals. Partnerships of two or more persons have already begun to engage in lending. At the same time, as a rule, agents (often from among trusted slaves) were sent abroad to oversee compliance with the terms of the agreement. Debtors often did not fulfill the terms of the contract, deceived creditors, arbitrarily changed the route and points of sale of goods, hid the true amount of goods sold against the terms of the contract. All this became the reason for frequent lawsuits in Athens and other Greek city-states.
Ancient Athens' judicial system in banking was so well established that it turned it into the center of international commercial and financial litigation of the time. In fact, in Athens, the banking proceedings were separated into a separate legal proceeding. Usually the initiators of the proceedings were the meals, seeking to return the loans with interest. This was especially true of the “sea loans” proceedings, where cases of fraud and deception of creditors were especially frequent.
There have been courts over the return of deposits by meals. Including the person involved in one of these processes was the famous and largest meal of Athens Pasion. Such cases were to be decided within a maximum of 30 days in order to avoid protracted proceedings and to ensure the return of funds or the sale of bail as soon as possible. The purpose of this speedy litigation was to protect the interests of creditors who provided their capital to finance critical economic activities. This confirms the importance of credit and debt relations for the Greek economy at that time. The numerous speeches of Greek lawyers, government orders and decrees that have come down to us, referring mainly to the 4th century BC. e., are introduced to litigation in connection with agreements on maritime loans. Interestingly, there were no legal disputes regarding the content of the contracts themselves, since they precisely defined the rights and obligations of all parties, the contract was concluded with witnesses and signed by them in duplicate, while one copy often remained with the banker-meal, who played the role of a notary.
The payment of the debt, which often took place through the mediation of meals, had to be carried out at a certain time, and to ensure its timeliness, the loan was always issued not to one, but to at least two persons under their joint responsibility and surety. Moreover, one of these persons had to remain in the place of payment of the debt, so that it was always possible to collect both debt and interest from him.
Sergey PAKHOMOV, Doctor of Economics, Professor of Moscow State University of Economics