Evening Republican, Volume 14, Number 22, Rensselaer, Jasper County, 26 January 1910 — UNIQUE BANKING SYSTEM. [ARTICLE]

UNIQUE BANKING SYSTEM.

Giro System of Hamburg DOOO Away With Gao of Check*. Very little Is known in this country of the Giro system of banking In Geriiiany. This system has been in use In the state of Hamburg since the establishment of the Hamburger Bank in 161*. An account is opened in the usual manner and when payments ars to be

made tha payer. Instead of preparing a check, merely instructs his banker to debit his account with the sum involved and to credit Richard Roe’s account with a like amount. If, however, payer and payee have their accounts in different banks, the payer then requests his banker to transfer the amount in question to the bank of the payee, with Instructions to credit Richard Roe’s account with the amount of "the Indebtedness. Convenient blank forms are provided for making these notifications, says the Bookkeeper. When the banker receives ap instruction of this character he in turn notifies Richard Roe of the payment to his credit and the name of the payer. In Hamburg the Reichsbank and five important -banks use the Giro system. Representatives of these banks meet several times dally at the Reichsbank, where transactions between their several customers are cleared. In Hamburg very little material money is used in effecting transactions, the habit being eo settle all obligations, even of the most Insignificant character, by Überwelßungszettel. When payments are to be made from one city to another this is done usually through the Reichsbank, which has five hundred branches, more or less, throughout the empire. All transactions are undertaken without cost to either payer or payee, and, on the contrary, deposits subject to this modified form of checking usually draw 1 per cent interest per annum.

The advantages of the Giro system fall partly under the head of security and partly of convenience. Danger from forgery is eliminated as the notification Bent to a banker by a payer could not by any possibility be utilized advantageously by criminally disposed persons. The Only Inconvenience observable arises from the fact that receipts for payments are not acknowledged on bills as rendered, unless such receipts are specially sought by messenger after the bank exchange has been made.

It is customary in small local transactions for a payer to note at the foot of bills the date of payment through the banker, and in case of possible dispute the bank is i always prepared to clear up misunderstandings. Concerns doing a large volume of business and obliged to make numerous payments dally are spared the annoyance of preparing hundreds of Individual checks, as they have merely to write out a list of names and amounts on a long sheet, which they send to their banker.