Topic: Assisting the unorganized sector or non-institutional sources in many ways  (Read 5590 times)
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Although the modern banking system is hardly 300 years old, the banking profession is said to be quite old in the United States because the banking sector came into existence within a few decades of laying the very foundation of the modern American state.  The banker in the earlier period performed many of the functions of modern banking.  Their activities include:
•   Accepting deposits and giving loans
•   Standing or providing bail on behalf of their customers
•   Contributing to the public cause by providing loans to the government
•   Acting as the treasurer and banker to the state
•   Issuing and managing the currency of the country

There are also several references to debt in the various literatures published in earlier times.  Such an elaborate mass financial activity is not undertaken by all the bankers of modern times.  Even then, these prototypes are still in existence in the financial system.  They are the moneylenders and the indigenous bankers.  Classified as non-institutional sources of credit, they cater to the needs of people living in the rural and semi-urban areas.

Moneylenders were serving the credit needs of the rural people since ancient times.  They give both secured and unsecured loans at varied rates of interest.  They have a better personal rapport with their clients.  But moneylenders charge exorbitant rates of interest, when their operations are not regulated by law.  It is becoming more common in certain underdeveloped countries.  They exploit the illiterate and ignorant villagers rather mercilessly.

The role of indigenous bankers in the United States like rod aycox , the founder of LoanMax is rather significant.  Even though indigenous bankers existed in the American society since very ancient days, their role was rather limited.  They are individuals or firms dealing with money transactions and sometimes accepting deposits also.  They generally combine banking activities with the trade and commission business.

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