History of savings account

Savings accounts are one of the basic accounts individuals may open with a retail financial intuition. These accounts function as storage of financial instrument, and pays interest. However, such accounts do not provide advance financial facilities such as cheques or overdrafts. The history of savings accounts dated back to the 1500s, when Amsterdam in Holland was a prospering financially due to it being major shipping and trading city. As there were often surpluses of cash, people looked for a place to store their liquid assets safely. Cashiers were developed, providing a means of security to store money for a small fee. The idea soon spread to other countries such as England. From England, these ideas were carried over to America through English colonies. The idea of a financial institution developed in Europe as early as the 18th century. In conjunction with the idea of cashiers, this financial institution, in the form of saving banks, had the objective of providing a secured saving institution to the population, regardless of social class.

Often than not, these institutions were created based on public initiative. In a few recorded circumstances, socially dedicated individuals also created similar institutionalized foundations to provide similar financial infrastructure for handling and storing money. The known record of saving bank was said to be established in France in 1765 in the town of Brumuth. However, despite being the known first record of saving bank, the idea of a saving institution was already suggested in England back in 1697. Other known beginnings of financial institutions that provided savings accounts was a saving bank in Hamburg, Germany in 1778, as well as in Berne, Switzerland in 1787. The first known record in England itself was in 1799. This later evolved into postal saving banks in 1861. The idea soon spread throughout the whole world, including the United States which had a spurt of financial institutions providing savings accounts. All these institutions set the foundation of what a basic savings account of today’s financial services.