INTRODUCTION TO Finance

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Theory and Practice

Banking originated in Babylonia in 3000 BC.

Individuals stored their valuables in safe places such as temples and palaces.

In Uruk, a Sumerian city in Mesopotamia, trade was backed by lending.

Some cultures such as Egypt, Greece and Sumerian charged interest on lending.

In these cultures, interest was considered from lenders point of view and it indicated an increase in something.

An early state intervention to finance can be demonstrated during the reign oh Hammurabi in Babylon, where among his laws was the law governing banking operations such as Article 100 on the timely payment of interest.

Interest was charged at 20% annually by the Babylonians.

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