The Genius Guides

Contrasting this situation with the specialized banking system of England, in which the lines of distinction between different types of institution are even more carefully drawn than hi the United States, but in which the amount of law relating to the subject is vastly less than here, the distinction drawn between the organized type of banking system and what we have called the specialized type is obvious, while hi both cases a clear line of distinction exists as against the heterogeneous banking system in which institutions come into existence with the privilege of doing practically anything that they choose. It remains true that in many parts of the United States, and in many of the less developed countries of the world, the exercise of various unrelated functions by banks is still the rule. The country bank in the western part of the United States will discount local commercial paper, lend on long term to farmers with mortgage security, accept savings deposits and pay interest on them, discount the notes of local merchants, furnish domestic remittances, make collections, hold for safe-keeping the valuables of customers, and perform a variety of other duties. The process of differentiation goes hand hi hand with the progress of the community hi the division of labor. One after another the various functions of The primitive bank are sloughed off or transferred to other institutions, until at length the specialized type of banking emerges either with or without definite organization of the land already described....