Banks and Savings

Piggy Banks are not always piggies. They can be elephants, pirate ships, toy houses or even pretend bars of gold. So why are they called piggy banks? The word ‘piggy’ comes from a brownish-red clay called ‘pygg’ which was used in the Middle Ages in Britain to make pots. Money was kept safe in pots made from pygg clay and the words pygg and pig got mixed up and the name stuck.

The banking system that we use today began in Italy about 600 years ago. The word bank comes from the Italian banca which means ‘bench’ as the earliest banking transactions were done by merchants on a table or bench covered in a green cloth.

Merchant ‘traders’ would make deals for the price of grain on the bench. The price might go up or it might go down but the deal had been made. Sometimes, if the grain trades (and later other financial transactions) were not upheld, the trader would lose all their deposits and the bench would be broken. They became, literally ‘bankrupt’ – a corruption of the Italian banca rotta – broken bench.µ

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Money keeping and money lending was also closely tied up with religion. Christians were not allowed to charge interest for money they had lent out. Interest was a small amount of extra money charged for the loan. However, Jewish people were allowed to lend money (though not to other Jewish people). It meant Jewish merchants often became moneylenders to Christians. They quickly gained a reputation as financiers. Lending money with interest was called usury and the person who had lent it, a usurer.

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