The first bankers were the goldsmiths of London who accepted deposits of gold and other valuables and issued transferable receipts promising to repay the amount on demand.

When those receipts began to circulate as money people stopped calling them receipts, and they began to describe them as goldsmith notes. So the goldsmith began to render some of the functions of bankers.

They accepted money and other valuable for safe custody and issued notes.

Soon afterwards they developed another important banking function that of lending. At the beginning the goldsmith charged the depositors a fee or commission for having their money kept safe.

When the goldsmith discovered that not all the deposits were demanded back at once and that total demand for repayment were always less than the total deposits, they started to lend out the balance and charged interest.

This turned out to be a profitable business and instead of charging commission for safe keeping money, they began to offer interest so as to get more money deposited which they could then re-lend. This is exactly what our present day banks do.

All these financial institutions were licenced and are regulated by bank of Uganda