A fascinating voyage into the history of banking

Cheque collecting as a hobby is a very recent development, and has emerged from the more established hobby called Notaphily, the collection of banknotes. The term was devised in the 1970’s by a group of employees working for the collectors and investments firm Stanley Gibbons, in a successful attempt to formalize and encourage interest in the area. Banknote collecting has always occurred, as people have been drawn to the often exquisite artwork associated with these vital instruments of trade. They also allow a country to display their culture and history upon a canvas that can travel far and wide.

Banknote collecting really took off in the 1940’s, especially in the USA but it never really went fully mainstream until the 1970’s, since when it has grown enormously as more and more people discover what a fascinating area it is. I myself became hooked on the hobby when I was about 13 years old. At the time I collected old records and would visit the street markets very early on a Sunday morning, as the dealers were setting up, to get the best deals and the pick of the stock.

One Sunday morning I discovered a dealer selling old foreign banknotes, and I bought a Chinese 5 Yuan note from 1935. The artwork was beautiful and the general design appealing. I have never looked back since and have developed quite a collection over the years, and I still have that Chinese banknote.

Lately I have taken more of an interest in cheques, as these are very closely related to banknotes, along with Traveller’s Cheques, Promissory Notes and Bills of Exchange. Cheques have been used as far back as Roman times and the Knights Templar greatly expanded their use, which offered pilgrims to the Holy Land a far safer means of transporting their wealth than carrying gold coin.

As modern banking became established in the 17th century, the use of cheques became more established as an element of regular forms of daily commerce. One of the earliest known still to be in existence was drawn on Messrs Morris and Clayton, scriveners and bankers based in the City of London, and dated 16th February 1659.

The Cheque

The definition of a cheque is as a negotiable instrument instructing a financial institution to pay a specific amount of a specific currency from a specified transactional account held in the drawer's name with that institution. Both the drawer and payee may be natural persons or legal entities. Cheques are order instruments, and are not in general payable simply to the bearer as bearer instruments are, but must be paid to the payee.

British cheques can be very visually appealing, especially the company cheques that were issued between the beginning of the 20th century, until around the middle of the 1950’s. These cheques are often very large, with beautiful script and pictorial features, very reminiscent of banknotes. Today they can be bought for extremely reasonable sums of money and can form a tremendously appealing collection that has a lot to say about social history and economic development.

The cheques of the 19th century are also extremely appealing and often feature the most amazing cursive handwriting. These cheques, especially from the early part of the century are beginning to follow an upward trajectory in price. As cheque collecting becomes a more popular and established hobby, mirroring the development of banknote collecting, the supply of these early cheques will decline and the prices rise even more steeply. Now is the time to purchase these items, as in another ten or fifteen years, they may well be unaffordable for the average collector.

One such example of price appreciation is of cheques written on the Hereford City & County Bank. This was a private bank founded by three partners in 1796. As with all the provincial banks of this time, they also issued banknotes. The bank only operated for a period of thirty years and went bust in 1826. Banknotes from this bank fetch very high prices, well into the hundreds of pounds for good examples.

Cheques from this bank can still be had from around £20. However, there is competition for them and prices are rising, as obviously, there is a limited supply given the banks short life and the amount of cheques that have disappeared over the years. There are probably only around 0.1% of the cheques ever written on this bank still in existence.

A cheque from the Hereford City and County Bank dated 1817

People develop collections on all kinds of themes. Some will collect cheques of a certain period, the Victorian, or Edwardian era for example, or cheques from the period of the world wars. You can even collect old football club cheques, if football is a great passion of yours. I have a section in my own collection for cheques written in the year I was born. I do not buy them as an investment, simply as an interest, and they can be had for minimal sums of money.

I do try to get them from a wide selection of banks though, and both as private and company cheques. Getting them from unusual locations can also add a little something, a bit of extra pizzazz, and my latest acquisition for my year of birth cheques is from the Channel Island of Sark.

The cheque as history

The collecting of cheques can also give you a fascinating insight into British banking history, from the myriad private banks and joint stock companies of the 19th century, through to the limited liability status that came in the early 20th century, and all the acquisitions and mergers of these small banks that have left us with the ‘big four’ high street banks of today. As we continue our journey into the 21st century, the high street bank branch is beginning to disappear, as banking moves online. Even the venerable cheque itself was due to be decommissioned, but as of 2017, it is still going strong and still has a use.

The collecting of cheques can also open a window into the social history of the past. The first cheque I ever bought was a company cheque from the Dartford Gas Light Company, written on the London & County Bank in 1868. Looking into this company revealed a fascinating slice of history. The company was established in 1826. In June, 1827, public gas lighting in Dartford commenced with a contract to light 68 lamps. The first coke was sold in July 1827. At the end of its first year the Company was supplying gas to 55 private lights.

Dartford, in those days a small Kentish town, was only 14 years behind the first gas company to receive its charter, in London, and only two years after the other great London gas company. Dartford can therefore be placed among the pioneers of public gas supply in the United Kingdom.

In December 1851, the Directors resolved that all consumers using more than one light be required to use meters and pay for the gas used accordingly. In 1868 a great deal of enlargement and extension of mains occurred.

A cheque from the Dartford Gas Light Company dated 1868

In 1877 the Directors decided that a new and larger gas holder was necessary and this work was completed on 11 June, 1879. However, within 3 weeks, at 11.00 p.m. on Thursday, 1 July, 1879, there was an explosion as the new gas holder, 74 feet in diameter, blew up.

The collapse of the gas holder was probably due to the cast iron tank giving way under the pressure of nearly 141,000 gallons of water (629 tons). Reconstruction took 18 months and the greater capacity was certainly needed by then, as the Company had amalgamated with the Darenth Vale Gas Company, whose district was to be supplied from Dartford. A new, larger gas holder was constructed in 1909, as demand for gas heating and cooking soared.

Amalgamation with the South Surburban Gas Company took place on 1 January, 1919. In 1918 there were 5,731 users and in 1926 8,311. After WW2, Dartford came within the area of the South Eastern Gas Board. Gas making in Dartford ceased on 1 April, 1955 there were then, after nearly 130 years, 23,000 users.

So as you can see, the mere purchase of an antique cheque can reveal the most amazing facts, and in your hand is a link to a rich industrial past, written out and signed by the very people living at the time, who were at the forefront of this technological advance. It is all rather awe inspiring really. What you may read in the pages of a book about the past, or on the internet, suddenly springs to life in all its astounding glory. It is the industrial revolution and its innovative progress, all contained on a piece of antique paper.

London - 19th December 2017

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