Savings banks and savings behaviour in 19th century England



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Savings banks and savings behaviour in 19th century England

Authors:


Dr Linda Perriton,

The York Management School,

University of York

YO10 5GD


Email: linda.perriton@york.ac.uk
Professor Josephine Maltby,

The York Management School,

University of York

YO10 5GD


Email: josephine.maltby@york.ac.uk

Abstract

Savings banks' records have the potential to provide new insights into the distribution of money and control over money within working class households. Data collected on the identity of depositors - their occupation and marital status - has suggested that a substantial proportion of accounts in some banks were opened by women, including married women, in the period prior to the Married Women's Property Act. (Perriton 2012, Maltby 2011). It has also revealed a number of account ‘types’ in use, which suggest that working-class savers opened and maintained accounts for reasons other than long-term thrift and prudence. The paper analyses the results of a study of a number of English banks in different locations (London, Bury and South Shields) and considers the implications for an understanding of the earning and disposition of money by single and married men and women. The differences in behaviour so far revealed may be related to regional differences in industry, in social expectations or in the operation of the banks concerned: the paper discusses these possibilities and suggests directions for further research in order to gain a fuller understanding of savings behaviour in the 19th century.

Introduction

Despite the ubiquitous presence of the savings bank in most high streets and towns in England and Wales throughout the last two centuries they have, until recently, attracted relatively little attention in terms of archive research. Much of the neglect of savings banks in terms of financial and economic history, as opposed to the history of social welfare, is a function of the ‘savings only’ model used in England and Wales, which funded interest payments to savers by purchasing government bonds (Horne, 1947).



Where banks were set up on a savings and loans model (e.g. Sweden) they become part of the wider financial network and developing infrastructure into the 20th century (Falting, Lilja and Peterson, 2007), whereas a savings only model, with its limited ability to mirror or influence wider financial fluctuations and developments, has been seen as a footnote in economic history or a rather pedestrian aspect of early social welfare history.

As gender historians we viewed savings banks in a different light. We knew, through our previous investigations of investment behaviour by women in the 19th century and from looking at women’s involvement in other forms of financial management (Maltby, 2011; Perriton, 2012) that an analysis of the ways in which women used financial institutions in this period was key to understanding not only the economic activity of women but also the distribution of money/control within working class households. Regardless of the significance of savings banks funds in the wider 19th century banking system, data concerning the behaviour of savers, and the way that savings banks were operated, are important sources of information about how retail banking for the masses developed as a result of the way that households used (and occasionally abused) financial management tools. Given that savings banks are seen as an important element in building economic stability in many developing nations and rural communities, the insights we can gain from the archive data have real potential to inform current policy decisions as well as our understanding of the past. And in the developed world, in the aftermath of the financial crisis, the recent calls for the return to thrift add to the case for a fresh consideration of the key features of the savings movement in the decades immediately following its birth.

This paper’s aim is to provide an overview of our recent archive research into the demographics and behaviour of depositors in a sample of savings banks in England and Wales in the period 1816-1900 as part of a fresh look at the history of savings banks in the UK. In the first section we will briefly outline the history of the savings bank movement in Britain, the literature that currently exists and outline more specific areas of interest in the records. The second section briefly outlines the type of data it is possible to recover from the extant archive collections from savings banks and the banks we have sampled. We then present an overview of the findings so far. The paper concludes by identifying the areas that we think are new and deserve further attention by researchers.

A brief history of the savings bank movement and the research literature

Savings institutions aimed at the working classes were first formed in Britain in the late 18th century with the express aim of their founders of encouraging the poor to exercise thrift in order to protect themselves against old age and illness. The most popular early form of organised income protection was the friendly society but the savings bank opened in Ruthwell in 1810 was the model for a rising wave of local banking institutions throughout Great Britain in the first half of the 19th century. Local savings banks had a number of distinctive features. Firstly, they had an explicit moral purpose - to encourage thrift among the poor, and hence improve behaviour. This moral purpose was an expression of the banks' social positioning: they were founded and run by the elite classes for the working classes. Secondly, the social order was reinforced by the banks’ governance structures that were based on the model of having volunteer elite boards, made up of local gentry, aristocracy, clergy and/or industrialists, assisted by a small number of paid staff. Thirdly, the banks had a limited function - to provide deposit facilities only with maximum amounts for deposit.1 They did not lend. Savings banks of this pattern developed rapidly and widely in a variety of locations, from large cities to rural districts. By 1818 there were 283 banks established in England and Wales, with a further 182 in Scotland (Lloyds Banking Group, undated).

Their growth slowed, stopped and reversed in the later 19th century, dropping back to 442 by 1880 when the trajectory of growth in other countries was still upwards (e.g. Germany, United States, France, Italy and Spain) (Wadhwani, 2011). The reduction in numbers of savings banks reflected a number of factors. One was the introduction in 1860 of the Post Office Savings Bank (POSB), which operated from a high proportion of Post Office branches. The POSB were professionally run and also more accessible in that they were normally open for longer hours than the savings banks and they offered facilities for transferring money between branches, both features that were attractive to users. But another key feature in the transfer of business to the POSB was arguably the governance weaknesses in savings banks, leading to a number of well-publicised fraud cases, which affected confidence in the volunteer-run local banks. There was a rising tide of financial regulation legislation in the second half of the century, which was much more onerous for a volunteer board than a professional one in that it required more frequent and transparent financial reporting and audit, regular meetings by trustees, internal controls and - by the end of the century - regulatory inspection of all branches. The 19th century ended with savings bank provision centred on a smaller number of large, generally metropolitan banks which were much more closely regulated, professionally managed, and a offered wider range of products than their predecessors. Those that survived, now known as Trustee Savings Banks, did so well into the 20th century and operated based on this model until the creation of the TSB central clearing bank in 1973.

Notwithstanding this long institutional history the existing literature on the growth and development of savings banks in Britain in the 19th century is fairly limited. Prior to Garon there have been only two monograph length general histories written in the past century (Horne, 1947; Moss and Russell, 1992). Other studies have been relatively few in number, and have concentrated on two areas: the class of investors (e.g. Pollard, 1959; Lemire, 2008; Fishlow, 1961), or local/regional studies on particular banks (e.g. O’Grada, 2008; Payne, 1967; Lloyd-Jones and Lewis, 1991; Lawson, 2005; Ross, 2002; Pollock, 2007). But these are not the only issues that are potentially relevant to an understanding of savings banks in the 19th century. An area that has so far attracted little attention is that of gender. As mentioned above, previous work on women’s activity as investors and as members of financial organisations raises the question of the extent to which women also engaged with savings banks. And, if they did so, what was the relationship between gender and marital/employment status in terms of their overall representation as a proportion of savers; and was their behaviour as savers different from that of other categories?

Pattern of use data is also under-used in British savings bank research. Johnson laments this state of affairs in his account of working class saving and spending in the latter part of the 19th and early 20th century. Johnson’s critique focuses on the standard research strategy of recording account balances against depositor occupational classifications. He points out that average account size gives no hint of whether deposits in individual accounts rose and fell in line with external economic trends, the length they were held or the uses they were put to (Johnson, 1985). In the US context the research of Wadhwani (2002, 2004) and Alter, Goldin and Rotella (1994) in relation to the Philadelphia Savings Fund takes just this approach but it has not been widely adopted in British research (Lloyd-Jones ad Lewis, 1991 is an exception).

The pilot study outlined below was planned with the intention of increasing our understanding of women as savers. However, in examining a sample of extant archive material it soon became clear that there were obstacles to comparisons between banks and in dis-aggregating women’s data according to age and marital status. The following section of the paper briefly outlines the research plan and the archival resources available and the challenges it presents to researchers of savings behaviour.


Research outline, data availability and methodology
The data collection process outlined in this paper is the pilot phase designed to inform the development of a larger research proposal on the financial management strategies of working class women in the 19th century. The pilot research identified four savings banks in England, selected on the availability of the records, the socio-economic environment they represented and accessibility. The sample includes banks that serviced the East End of London, two growing industrial centres and a port town

.

Specifically, the archive material we consulted was for:




  • Bury Savings Bank – Depositors’ ledgers in Lloyds/TSB archive, microfilm copies of some records in Bury Archives2

  • Limehouse Savings Bank – Depositors’ ledgers covering all accounts opened between 1817 and 1876 and incorporating depositor declaration information in account headers. All originals held by Tower Hamlets Local History Centre and Archives.

  • South Shields Savings Bank – Depositors’ ledgers in Lloyds/TSB archive.

  • Newcastle City Branch Savings Bank – Despositors’ ledgers in Lloyds/TSB archive.


To date we have analysed data of 14,661 depositors, and a sub-sample of 1,676 accounts from Limehouse, Bury and South Shields. The 1,056 accounts from Newcastle are yet to be processed.

In addition to the objective of comparing the use of savings banks by men and women of all ages the research has been designed to examine, wherever possible, the account behaviour of all savers but especially women. In order to explore savings behaviour the bank archive material must contain depositors’ account ledgers. Depositors’ account ledgers are not the majority of archive material held on savings banks – probably because of the space that they took up and also because of the redundancy of the data once the life of the account had expired. Depositors’ ledgers can be used in isolation if biographical details about the saver are transferred to the head of the ledger column at the start of the account. Limehouse Savings Bank, for example, has no extant depositors’ declarations but the local administrative practice was to write the name, address, marital status (for women only) and adult status at the top of all new account columns. South Shields included the name and marital status of the depositors but merely noted whether they lived north or south of the River Tyne. Bury included names and addresses and occupations, but Newcastle only recorded names and occupations and marital status at the head of their account columns.

Even where there the holdings list suggests that there is a long run of continuous account ledgers still in existence for the 19th century it is not always possible to extract long run data. The account ledgers for Bury, for example, start in 1822 but account numbers were reorganised and reassigned in 1844 and new accounts issued with re-used numbers and in non-continuous sequences in the ledgers making it almost impossible to reconstruct lists of new account cohorts until 1854. South Shields accounts are intact throughout the 1850s but incomplete after that date.

Two sample years of 1851 and 1861 were selected prior to the start of the data collection in order to allow crosschecking of depositors against the census records. Unfortunately, because of the renumbering and reorganisation of the Bury account ledgers it was not possible to collect reliable data for Bury in 1851 and 1861 and instead the closest year of complete ledger details was chosen (i.e. 1855) and then 1865. We chose 1853 for the South Shields data and 1863 from the Newcastle accounts to give us a 10-year interval snapshot of savings behaviour in the industrial and shipping centres of the North East. Individual accounts were summarised using the following measures: length of account holding, maximum balance held, number of transactions and notes taken of any additional activity in respect of the account e.g. the addition of a spouse as co-holder or unusual features.

Even within a small pilot sample of bank records it became obvious that comparative data was going to be difficult to extract. Trustee savings banks did not operate as branches of a central bank but as independently formed and operated local banks. Each savings bank remained a separate legal entity even when they chose to be covered by the terms and conditions of the Savings Bank Act of 1817 and subsequent acts. In the absence of a centralized bureaucracy or standard operating procedures banks were free to follow their own administrative whims. The basic information that savings banks were required to collect from their depositors was not set out in legislation until 1828, which means that although some broad depositor information is available from 18163 it is only in 1828 that most savings bank data becomes detailed enough to be useful4. Therefore when we refer to 19th century savings bank data in respect of depositors it is more accurate to think of financial activity in the period 1830-1900.

Creating a comprehensive database of 19th century retail and savings bank archive material is outside the scope of our project. However, within our current set of sample banks it is possible to identify depositors with relative confidence by gender, adult and marital status and occupation from the ledgers. Where savings behaviour is concerned it is possible to create a set of savings cohorts and to analyse the management of individual accounts in terms of amounts deposited and drawn out within each ledger volume. The vagaries of transferring the balances and information attached to individual account holders where the life of the account exceeded the ledger volume it was first entered into proved too complex. In practice therefore the data collected noted where accounts lasted a minimum of ten years, which is approximately the length of time covered by a single account ledger in the banks sampled.

It is difficult to account for the lack of savings bank studies that examine pattern of use data. As long as there is an identifiable account holder and a reasonable continuous run of account ledgers then there are no insurmountable methodological barriers to the collection and analysis of this data beyond the usual hardships i.e. voluminous amounts of non-machine readable data and lack of time, money and assistance to do so. The methodological choices were therefore ones of how to select the criteria for the categorization of the data.

The preliminary analysis of saver behaviour, or ‘pattern of use’, data has also suggested that this is a promising line of investigation where continuous and chronological sequential account ledger records are available. As explained briefly in the methodology section the coding system for account use is based on patterns of deposit and withdrawal.

The coding system for account use is based on the number of total transactions on the account throughout its life. Indeed, this was the basis of the method used in two surveys undertaken on account usage by the Post Office Savings Bank in 1930, where accounts were grouped on the basis of having ≤ five transactions, ≤ eleven transactions ≥ thirty transactions (Johnson, 1985). However, using total transactions as the criterion for classification results in a one-dimensional picture. Another option is to include the number of years the account is held (which the POSB surveys did not), which then is used to provide an indication of average account usage per annum. But again, the calculation of a ‘transaction per year’ score does not indicate how the accounts were used. In order to isolate different types of accounts it is necessary to compare deposit and withdrawal transactions and to remove interest additions by the institution from the total count.

Four types of account usage were identified.


  • The first account usage type is characterized by an equal numbers of deposit and withdrawals but only ever consisted of two transactions in total i.e. there was an opening deposit and a subsequent withdrawal of the same amount prior to the qualifying period for interest accrual. This account usage is labelled the ‘in and out’ account.

  • The second type of account is one where there is a lot of activity but where there is no discernible pattern of deposits and withdrawals; as it was suggestive of an account being used to plan for and to respond to normal households contingencies in a short time period and it has been labelled as the ‘contingency account’.

  • The third category of account corresponds to a target saving behaviour where there is a regular pattern of deposits and then one lump sum withdrawal, presumably when the individual’s saving objective has been met. This account usage has been designated as an ‘accumulating account’.

  • The last category of account is where there is a single lump sum deposit and the customer withdraws from that initial deposit in smaller withdrawal amounts over time until the original money is depleted and the account is closed. This is referred to as ‘draw down’ account behaviour.

A spreadsheet was created for each ledger volume examined. The first three columns were for biographical details: the page of the ledger the record appeared on, the name of the depositor and their address. The following three columns recorded total transactions on the account (excluding interest payments) and then the number of deposits and withdrawals. The maximum account balance was then noted, with separate columns for pounds, shillings and pence. The attribution of the saver was then recorded against one of the following available categories: male, widow, married woman, single woman, minor (female), minor (male), charity, trust and joint accounts. A note was made in a dedicated column if the account had undergone some form of transition or change in its history (e.g. a single female had become married, or a spouse’s name had been added changing a single account to a joint account).

The data collection phase for this pilot study has now been completed but, as mentioned above, the analysis is ongoing. We have so far constructed the following data set: a year-by-year summary of new accounts by saver category for Limehouse from 1830-1876 and five sample years of account behaviour for Limehouse (1851/1861) and Bury (1855/1865) and South Shields (1853). Because of the limited data collection resources we had we have used Limehouse as our benchmark for comparison in terms of category of saver, long terms trends in saver category, type of account created, saver behaviour and economic participation5. Other bank records have been sampled selectively to check whether the categories established by the Limehouse data sets are robust and reliable and could form the basis of a wider data collection exercise. For example, the Limehouse accounts reveal a small, but persistent, number of ‘joint accounts’ by family members, married persons and non-related individuals. We know from checking declaration books held by the Sheffield and Hallamshire Bank, for example, that they also created and maintained joint accounts but Bury shows no such accounts in the sample years 1855/1865 and neither can we see any in a separate check of their extant depositors’ indexes. Such discrepancies are helpful in the sense that they qualify comparative data between banks (i.e. did savers, especially married savers, have the option of organising their finances in a particular way and, if not, how does that affect our analysis of the numbers in comparative data?). They also suggest new, or additional, research questions (e.g. to what extent did local management decisions affect working class financial management strategies?). Some of those issues of comparability, interpretation of categories of saver and modification of research questions arise again in the next section when the preliminary analysis of the Limehouse, Bury and South Shields data is discussed.


Preliminary findings
As mentioned previously one of the principle aims of the pilot research was to establish whether, and in what numbers, women were using savings banks as part of their financial management strategies and tools. From that main research question came sub-questions regarding whether or not differences could be discerned between categories of women savers in terms of the age, employment and marital status of women savers, the frequency/regularity/amount of savings deposits and the length of time for which savings accounts remained open.

Decade

1830s

1840s

1850s

1860s

1870s (partial)

Number of total new accounts

in each decade



2440

3156

3885

2633

1480

Adult Male accounts % (total)

35.8

37.3

38.4

37.9

38.5

Adult Female accounts % (total)

31.2

33.3

34.8

39.8

40.0

* widows %

4.4

4.9

3.9

4.5

4.3

* married women %

14.8

16.6

18.3

23.0

24.7

* single women %

12.0

11.8

12.6

12.3

11.0

Female Minors %

9.3

6.6

7.8

6.5

6.3

Male Minors %

11.5

8.9

9.1

8.5

9.3

Charities %

2.8

3.5

2.6

3.5

3.6

Non-standard %

9.4

10.6

7.2

3.8

2.3


Table One: Limehouse Savings Bank, new savers’ percentages by classification
Adult men represent the largest overall group of depositors in the Limehouse Savings Bank from its opening until the end of the 1850s. This would be expected given that are, that it is not possible to disaggregate their data on the basis of marital status as it is for adult women.

At the end of the 1850s there is a marked rise in the number of married women account holders and adult women become the largest overall group of depositors. This is some 20 years before the passing of the Married Women’s Property Act in England. The provision for married women to open and hold accounts as individuals was allowed for by the Savings Bank legislation from the start but even so the presence of married women accounts in 19th century account ledgers of British savings banks is often overlooked (Maltby, 2011 is an exception) given the almost exclusive interest in occupation categories (the only means by which adult male accounts can be compared) and overall account size and trends, rather than depositor behaviour within categories6. Where the emphasis in the research is on thrift then women are considered as a category, but again the focus is on women’s occupational status with the general agreement that female servants were well placed to accumulate savings and that this was an explanation for the large numbers of savings accounts held by women. By the 1870s circa 40% of accounts are held by adult women; 25% being held by married women, which is realistic given the estimates of married women’s involvement in the labour market in this period. Indeed, Field and Erickson (2009) suggest that savings bank data is probably the best indication we have of the rates of economic participation by married women in the pre-census era. In related work on the geography of adult female employment in England using the 1851 census Shaw-Taylor (2007) estimates that the rates of regular employment of adult women in the London registration districts that cover the East End to be 20-30%. As it is not clear to what extent irregular employment was recorded in the census the 20-30% figure will probably understate female participation rates, with the 40% in our banking sample perhaps being a more accurate measure. Roberts (1988) refers to oral evidence collected from married women in the northwest that at least 40% participated in the labour market on a part-time basis in the late 1800s, again suggesting that economic activity was the driver of savings behaviour in adult women.



Disappointingly, the idea that married women banked as a result of independent economic activity, is a case that authors feel that they have to build rather than treat as a given as with adult male bank deposits. For example, in Pollock’s (2007) study of the Bridgeton Cross branch of the Glasgow Savings Bank, the majority of the discussion is not given over to the data but considering whose money the women are depositing. Although Pollock ultimately dismisses the argument that women are acting on their husbands’ behalf, or are using money that their husbands have given to them as opposed to banking their own wages, there is a persistent tendency in historical banking studies to dismiss the idea that women were active economic agents in their own right prior to the passing of the Married Women’s Property Acts later in the century.


A regional comparison of account holders
The first comparative results from the pilot research suggest that adult women represented a significant percentage of savers in both the London metropolitan area and the industrial northwest and northeast. However, the comparison of sample years shows that there are regional differences in who – within the larger category of adult women savers – are the largest group of savers. In Limehouse and South Shields the largest group of women savers are married women; in Bury the largest group of female depositors are single women. These local shifts in representation are perhaps the result of the socio-economic environment and mix of industries and employment opportunities available to women in each location. The consistency in the representation of adult women in both Limehouse and Bury savings banks, together with the absence (as a probable result of local management decisions) of joint and other non-standard accounts, suggests that non-standard account forms are more likely to affect adult male account holding numbers than those of women. The implication of these findings – and what they suggest about financial management strategies within households – is an important additional question for the planned larger research project.





Percentage of Total New Accounts in Sample Years

Saver Categories

Limehouse 1851

Limehouse 1861

Bury 1855

Bury 1865

South Shields 1853

Adult Men

38%

41%

49%

44%

46%

Adult Women

34%

39%

38%

39%

44%

* widows

5%

5%

4%

2%

6%

* married

women


18%

22%

8%

8%

29%

* single

women


11%

12%

26%

29%

9%


Female minors

7%

6%

6%

9%

2%


Male minors

11%

9%

7%

7%

3%

Joint accounts

6%

4%

N/A

N/A

N/A

Trusts

4%

2%

0%

0%

5%


Table Two: Percentage of accounts held by different saver categories in Limehouse, Bury and South Shields in the respective sample years.
The particular feature of the Limehouse and Newcastle City Branch accounts is the presence of joint married accounts. It was a relatively common to see a note in the ledger converting an adult male account into what is effectively a joint married account by the addition of the wife’s right to draw. Whilst it may be the case that men were adding wives to their accounts at the time of their marriage in order to transform their accounts into joint married accounts, it is no means certain that all the cases were of this type. The practice of adding family members or unrelated persons to the account for periods of time and later withdrawing them, or of adding a named individual and later withdrawing the name of the original account holder is a constant feature within the ledgers throughout the period studied. Married women also added their spouses to their accounts in similar percentages to those of men adding their wives, suggesting that the practice was more likely to be the result of decisions about convenience in relation to the operation of the account rather than indicative of a desire of husbands to control their wives’ accounts more closely. It is, of course, possible that some of the women that converted their accounts to joint married accounts did so before it reached the point where their husbands were added ‘by order’ but, even so, the evidence would suggest that the banking arrangements within households were largely consensual, as opposed to conflictual in nature.

The married women accounts in South Shields show an occupational effect. Just over 20% of new accounts opened in 1853 were by adult men who listed their occupations as mariner, or master mariner. But 53% of accounts opened by married women listed their husband’s occupations as such. The periods of absence necessitated by their husbands’ occupation requiring at the very least their independent access to money, and quite possibly responsibility for control and decision making re the family finances that is in keeping with a consensual model.

The reduction in the number of trust accounts after 1844 can be attributed to legislation that amended the regulations so that accounts could not be held in trust without the person for whom the trust was established enjoying the benefit of the account. After 1844 the trustee and the individual for whom the account was held both had to sign on withdrawal. The adult trust account was widely believed to be a loophole in the regulations through which middle class investors (the bogeyman of those who saw savings banks as mechanisms for instilling thrift in the working class population) exploited the banks by creating multiple accounts and benefitting from the higher interest rates than those available commercially.

Although there is a noticeable fall in the number of adult trust accounts after 1844 such accounts are still opened but they appear to be used to manage the finances of adults who are prevented from looking after their own affairs by physical, mental health or learning disabilities. A smaller drop is also seen in the number of trust accounts for minors, although this change is not as significant and the effect lags behind that of adult trusts – perhaps a result of such accounts being kept until children obtain their majority and/or a level of economic activity justifying their own account.


Savings behaviour – types of accounts held
Comparing deposit and withdrawal activity identified four types of account usage. The first account type is where there are two transactions in total i.e. there was an opening deposit and a subsequent withdrawal of the same amount prior to the qualifying period for interest accrual. The second type of account is where, regardless of the amount of activity above the minimum two transactions, there is no discernible pattern of deposits and withdrawals. This sort of account, which is suggestive of an account being used to plan for and to respond to normal household contingencies in a short time period has been classified in our study as a ‘contingency account’. The fourth category of account corresponds to a target saving behaviour where there is a regular pattern of deposits and then one lump sum withdrawal, presumably when the individual’s saving objective has been met. This account usage has been designated the ‘accumulating account’. And finally there is the account that consists of a single deposit from which the customer withdraws from in smaller withdrawal amounts over time until the original money is depleted and the account is closed. This is referred to as a ‘draw down’ account.
In and out accounts

Sarah Williams has noted the difficulty of examining the beliefs and interpreting the actions of historical actors when the material on which we rely is largely that left to us by middle-class observers defined by their own institutional presuppositions (Williams, 1996, as cited in Brodie, 2004). The context of Williams’ comments was in respect of religious belief, but they are also apposite to the motivation to save. Looking at the 1851 and 1861 comparative figures for married joint accounts (+18.73%) and married women (+13.87) it is tempting, if following the thrift narrative, to attribute the worsening performance of savers in those categories to the accounts being abandoned through apathy (Johnson, 1985). Certainly as viewed from the Smilean perspective, accounts of short duration would almost inevitably have been considered ‘failed’ - the result of an individual’s inability to practice common sense, and a lack of willpower to resist selfish enjoyments (Smiles, 2011). This is to view savings success from the perspective of the middle-class policy-makers and advocates of working class thrift as opposed to the savers themselves. Johnson acknowledges this problem in discussing the 31.6% of the accounts sampled in the 1930 POSB survey that were used for five transactions or less. It is possible that some accounts were abandoned through apathy or lack of moral fibre; it is equally possible that the savings objective had been achieved, regardless of the short time period the account was held (Johnson, 1985).

Savings banks did not allow for an account to be held with a zero balance. When the balance was withdrawn the account was closed, regardless of the savers inclination to save again using the same facilities. All the bank ledgers we have examined so far evidence multiple account closures and re-openings on accounts that have as many as half a dozen breaks in their operation. Where possible the clerk would start the account record under the original account entry but it is not clear whether this practice was widespread or consistent. For example, in South Shields the blacksmith, Benjamin Dain, opens and closes an accumulating account early in 1853 and is re-entered separately as opening a new account with a new sequential account number later in the same year and again uses it as an accumulating account. Therefore the number of ‘in and out’ accounts cannot be considered proof positive of failed savings behaviour but could, as evidenced from other ledger entries of savers that returned to re-open accounts, suggest that some customers might have benefited from a distinction being made between a zero balance and account closure.
Contingency accounts

The ‘contingency account’ is the most commonly occurring account type for adult savers, although married women in Bury and single women in South Shields were more likely to operate accumulating accounts. We believe the prevalence of the contingency account across all locations and most adult savers shows that savings bank accounts were interactive financial products that helped individuals budget and allocate scarce resources within short-term financial cycles. This is a very different use of the savings account than envisaged by advocates of thrift for smoothing out life-cycle risks by the incremental accumulation of funds over years, or even decades. The pattern of deposits and withdrawals is, however, consistent with low wage financial management strategies that were common to most working people in 19th century. Low wages resulted in a lack of ready cash, erratic savings and few possessions or ‘portable property’. The fact that most householders rented their accommodation meant that credit could not be raised against housing, and so was pledged against material objects or against future earnings. A lack of secured credit meant that the creditor loaned, or gave goods on credit, on the basis of trust (White, 2008).


For the poor and the working class short-term credit was usually obtainable at the corner shop and from the landlord. Indeed, landlords, wittingly or otherwise, were the main bankers to the poor. Rent arrears were built up in hard times to be worked off in good. Many grocers ‘ran a book’, totting up purchases made on credit during the week to be redeemed on payday (White, 2008: para 3).
This was the reality of the majority of Limehouse savers throughout the 19th century and was also true of working class savers in other regional centres. Many of the deposits and withdrawals would have followed the cycle of the rent book or was cash put aside for the door-to-door tallyman, who provided clothing and other drapery for small weekly instalments at high interest (White, 2008). Shortfalls in the cash needed were most likely made up using the local pawnbroker who loaned cash against the few portable possessions owned by individuals – clothing and jewellery. White notes that as the 19th century progressed the number of pawnbrokers in London increased, and the need for short-term credit that was the inevitable outcome of the ability to manage only short-term saving, remained high ‘despite the growth of building societies, of savings or loans clubs based on trade unions and church missions and cooperative societies, or the more risky local versions that mushroomed in pubs and working men’s clubs’ (White, 2008).
Accumulation accounts

Arguably this is the only type of account usage that the founders of the savings banks would have recognized, and approved of. Accumulation accounts represented circa a quarter of the total account types in both the sample years. There were clearly some categories of savers who were more likely to run ‘standard’ savings accounts in 1861 i.e. children of both sexes and single women, of whom a growing proportion were recorded in the accounts of this period as being in domestic service or, in the case of Bury, working in the textile industry. Savings accounts were valued and maintained but the overall trend was not for long-term accumulation to cover life-cycle risks but for target savings behaviour.


Draw down accounts

Accounts of this type were established with a lump sum deposit, presumably obtained through a gift, inheritance or bequest and then gradually drawn upon and depleted over time. It is not surprising to see widows as the category most likely to use their savings accounts in this way, suggesting a dependence on a lump sum inheritance or gift on which to supplement and manage their budget. Again it is notable that the use of trusts in the latter sample year has declined as a mechanism and that the money appears to have moved instead into joint accounts, although the small number of accounts exaggerates the apparent shift.








Most common account type in each saver category

Saver Categories

Limehouse 1851

Limehouse 1861

Bury 1855

Bury 1865

South Shields 1853

Adult Men



Contingency (65%)

Contingency (61%)

Contingency

(56%)


Contingency

(44%)


Contingency

(49%)


Adult Women
















* widows

Contingency (50%)

Contingency (56%)

Contingency

(53%)


Contingency

(75%)


Contingency

(39%)


* married

women


Contingency (67%)

Contingency (65%)

Contingency

(48%)


Accumulating

(50%)


Contingency

(60%)


* single

women


Contingency (58%)

Contingency (46%)

Contingency

(45%)


Contingency

(43%)


Accumulating

(52%)


Female minors

Contingency (54%)

Accumulating (47%)

Accumulating

(46%)


Accumulating

(61%)


Contingency

(60%)


Male minors

Contingency (68%)

Contingency (52%)

Accumulating

(57%)


Accumulating

(68%)


Contingency

(55%)


Joint accounts

Contingency (71%)

Contingency (43%)

N/A

N/A

N/A

Trusts

Contingency (63%)

Accumulating (50%)

In & Out 50%/Cont 50%

Contingency

(100%)


Accumulating

(60%)



Table Three: Most commonly occurring account type in each saver category
Further research needed
The work completed so far as part of the pilot project suggests that savings banks, and their archived account holder records, deserve greater attention than previously given. The preliminary results suggest a number of possible directions for extension of this work. For example, the clear differences in the representation of married and single women in Limehouse and Bury suggests that it is desirable to extend its geographical scope in order to reflect local economic contexts and types of industrial settings. Some variation seems to be apparent at the moment, but a wider sample is needed to support or contradict this suggestion. Was this difference related to local economies, or to the behaviour of management at different banks, e.g. encouraging or deterring particular groups of savers? Similarly, did periods of local economic growth or depression result in different behaviours in terms of saving per se, the pattern of use (so that e.g. accounts were cleared because of lower earnings) or the gender of savers?

Further work has to be done in analysing saver behaviour according to the time the account is held (e.g. establishing whether ‘in and out’ accounts are suggestive of ‘failed’ savings intent by being clustered in the < 2 years account category). However, the overall implication of the findings - that most savers were using their accounts to manage the cyclical contingencies of their household budgets rather than accumulating a lump sum to use as a pension fund, as the founders fondly imagined they would do - is important. The findings summarised in Table Three suggests that the conduct of savers transcended the ‘savings’ aim of the founders and that rather than looking at savings bank records for what they can tell us about the philanthropic aims of politicians and social reformers, we are likely to find that account ledgers and depositors’ declarations can provide insight into the formation of mass market consumer banking in England and Wales.



It is also the case that as the 19th century progressed many smaller banks vanished, although the largest metropolitan ones survived into the 20th century. Another question for the data is whether it is possible to relate survival to the pattern of use of accounts in those banks. Was it the case, for example, that smaller banks were less able to compete against the competition of the POSB, whereas the larger ones had longer-term, more loyal savers?

And beyond the banks themselves, this work suggests potential new insights into household savings behaviour. There is evidence that married women exercised economic agency by opening and managing accounts, and that they were able to pursue a variety of patterns of saving, for the long as well as the short term. What does this suggest about the management of money within the household? Were they acting on behalf of husbands and children who brought home the money, or has employment by married women in the mid-19th century been understated?
Conclusion
The evidence from Limehouse and Bury about the significance of the activity by married women as savers, and the existence of joint married accounts in Limehouse and Newcastle, challenges the existing literature regarding working class women and financial independence. The presence of married women's accounts in 19th century account ledgers of British savings banks has been overlooked and the marital status of women savers has very probably been the casualty of the almost exclusive interest in occupation as a way of categorising savers. An emphasis on occupational categories has had the effect of marginalising the discussion of women in the savings literature because they often make up the bulk of the single occupational category of domestic servant. Having found an occupational explanation for the presence of women savers there has been little interest in looking more closely at women savers.

The savings banks were founded with moral and social aims - to improve the behaviour of the working classes by stimulating long-term savings, thus diverting customers from feckless enjoyment and giving them a stake in society. But the patterns of savings behaviour we have found so far suggest that customers saw the opportunity to use the banks' facilities, limited though these were, to meet their personal needs. This appears to be reflected in two ways: in a set of different patterns of saving, for short as well as for long-term, and in a variety of different ownership groups, married and single. We are confident when this work was extended further we would be able to examine in greater detail the regional differences and socio-economic influences on savings behaviours of all groups. In the short term we intend to continue our work on using the findings on women’s savings behaviour to re-assess the established debates about married women’s financial dependency and to investigate wider questions regarding the management of finance by the working classes.

Acknowledgements

Much of the fieldwork supporting this research has been made possible as a result of a BAC bursary that has part-funded the costs associated with accessing the archives of a number of provincial and metropolitan savings banks, which later amalgamated to form the Trustees Savings Bank. The authors are grateful to the BAC for the opportunity the bursary gave for this pilot research to be carried out. We would also like to extend our thanks also to the staff at the Tower Hamlets Local History Library and Archives, especially Malcolm Barr-Hamilton; the staff at York City Archives (now part of York Explore); Bury Archives and Sheffield Archives. We are especially indebted to Karen Sampson, Anne Archer and the team at Lloyds TSB Archives for their patience and assistance.


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1 Although special investment accounts were offered by some banks later in the century

2 These include minute books 1829-1896, printed annual reports1865-1975 (gap 1915-1918), internal accounting records 1822-1904, and depositor account ledgers 1822-1903

3 The Limehouse Savings Bank, for example, and in contrast to other savings banks of the period never allowed the opening of an account using only a number or ticket. The practice of not requiring named depositors created, critics of the system believed, the means by which the middle classes could open multiple accounts.

4 Cap XCII 9 GEO IV – An act to consolidate and amend the Laws relating to Savings Banks 28th July 1828. Clause XXXII stated that “no sum shall be paid or subscribed into any Savings Bank by any person or persons by ticket or number or otherwise without disclosing his or her name together with his or her profession business occupation calling and residence to the Trustees or Managers of such Savings Bank and the Trustees or Managers of every Savings Bank are hereby required to cause be name of such depositor together with his or her profession business occupation calling and residence to be entered in the books of the Institution” 

5 A more detailed analysis of current Limehouse results is currently available in L. Perriton, Depositor trends in the Limehouse Savings Bank, London between 1830 and 1876. 2012 http://www.esbg.eu/template/event.aspx?id=1526§ion=Winners (accessed September 2012)

6 E.g. Payne (1967) focuses on occupational categories to the exclusion of all mention of gender. Johnson (1985) undertakes no separate analysis on gender in his broad survey of saving and spending, nor does his more detailed analysis of the Post Office Savings Bank look to the use made of accounts by married women. O Grada (2008) is more balanced in his treatment of women’s accounts in the Irish context, but again subsumes discussion of them in terms of account balance and the degree to which domestic service was an occupational category.



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