Textbook definitions

A seem above, the Court of Appeal in United Dominions Trust v Kirkwood suggested that for a deposit-taking business to be carrying on a banking business, it did not have to be engaged in making loans but, the Court went on to quote from Paget’s Law of Banking, that it must,

… accept money on current accounts, pay cheques drawn upon such account on demand and collect cheques for customers; that if such minimum services are afforded to all and sundry without restriction of any kind, the business is a banking business whether or not other business is undertaken at the same time; that providing the banking business as so understood is not a mere façade for other business, the person or corporation is a banker or bank for the purposes of statues relating to banking other than those where the sole criterion is the satisfaction of some government department.

Halsbury’s Laws of England defines a banker as:

… an individual, partnership or corporation, whose sole or predominating business is banking, that is, the receipt of money on current or deposit account and the payment of cheques drawn by and the collection of cheques paid in by a customer.

Dr HL Hart defines a banker or bank as:

… a person or company carrying on the business of receiving moneys, and collecting drafts, for customers subject to the obligation of honouring cheques drawn upon them from time to time by the customers to the extent of the amounts available on their current accounts.

The above definitions are excellent definitions of deposit banking. They are, however, no longer wide enough to relate to the diversity of modern-day banking.