SAVINGS BANKS are institutions of modern invention, established in this country to encourage habits of prudence on the part of the poorer classes, who were previously without auy places where they could safely and profitably deposit the small sums which they might be able to set aside from their earnings.
The origin of savings banks has been attributed to the Rev. Joseph Smith of \Vendover, who, in the year 1799, circulated proposals, in conjunction with two of hie parishioners, in which they offered to receive from any inhabitant of the parish any sum from twopence upwards every Sunday evening during the summer months, to keep an exact account of the money deposited, and to repay at Christmas to each individual the amount of his deposit, with the addition of one third to the sum as a bounty upon his or her economy. The deposi tors were at liberty to demand and receive back the amount of their savings, without this bounty, at any time before Christmas that they might stand in need of their money The next institution of this kind that was established, of which we have any account, was founded at Tottenham in Middleses, by Mrs. Priscilla Wakefield. This, which was called the Charitable Bank, bore a nearer resemblance to the savings banks of the present day than the Wendover plan. The Tottenham bank was opened in 1804. At first the accounts were kept by Mra. 'Wakefield, who was assisted in other respects by six gentlemen acting as trustees, who undertook each to receive an equal part of the sums deposited, and to allow five per cent. interest on the same to such depositors of 20 shillings and upwards as should leave their money for at least a year in their hands. In proportion as the amount of the deposits increased, additional trustees( were chosen, so as to diminish the loss, which might otherwise have been considerable, owing to the high rate of interest that was allowed. In 180a a society was formed at. Bath, managed by eight individuaLs, four of whom were ladies, who received the savings of domestic servants, and allowed interest upon the same at the rate of four per cent.
The Parish Bank Friendly Society of Ruthwell was funned iu 1810 by the Rev. Henry Duncan, who published an account of his institution with the hope of promoting similar establishments elsewhere. This
was the first savings bank, regularly and minutely organised, which was brought before the public, and it is doubtless owing to the suc cessful example thus set, that previous to 1817 there were seventy rav ings banks established in England, four in Wales, and four in Ireland.
In the year just mentioned legislative provisions were first made for the management of these institutions. Acts were passed (57 Gee. 111. C. 105 and 130) for encouraging the establishments of banks for savings in Ireland and England respectively. Under these Acts, the trustees and managers, who were prohibited from receiving any personal profit or advantage from the institutions with which they should be connected, were required to enrol the rules of their insti tutions at the sessions. A fund was established in the office for the reduction of the national debt in London, entitled, " The Fund for the Banks for Savings," and to this fund the trustees were bound to transmit the amount of all deposits that might be made with them when the sum amounted to 501. or more. For the amount so invested the trustees received a debenture, carrying interest at the rate of three-pence per centinn per diem, or 41. 11s. 3d. per centum per annum, payable half-yearly. The rate of interest then usually allowed to depositors was four per cent. In Ireland the depositors were restricted to the investment of 50/. in each year, and in England the same restriction was imposed, with a relaxation in favour of the first year of a person's depositing, when 100/. might be received. No further restriction was at this time thought necessary as to the amount invested, neither was the depositor prevented from investing simul taneously in as many different savings banks as he might think proper. This circumstance was found liable to abuse, and an Act was passed in 1824, which restricted the deposits to 50/. in the first year of the account being opened, and 30/. in each subsequent year, and when the whole should amount to 2001. exclusive of interest, no further interest was to be allowed. Subacribers to one savings bank were likewise not allowed to make deposits in any other.