Bankers and Banking in Medieval Italy
Lecture by David Abulafia
Given at the Erasmus Historical and Cultural Research Forum in London, on June 13, 2017
Banks as we have come to know them in today’s world owe their origins to the innovative credit mechanisms developed in medieval Italy. By the twelfth century these ‘financial products’, including the holding of deposits, were underwriting the long distance transportation of goods. Venice – positioned at the intersection of Europe’s west with the trading routes from the East – was a notable early centre of banking.
Genoa – another great maritime republic – witnessed similar developments and the history of European economic development in the central middle ages is inseparable from the story of the bank-owning families of Florence – such as the Medici, Bardi and Peruzzi. Then – as now – banking and finance generally could not be divorced from ethical questions and the political context.
Lending at interest (considered as ‘usury’) was against the official teaching of the Christian Church. But the Papacy – like many a cash-strapped European monarchy – too advantage of the lines of credit and banking structures that were an established feature of Europe’s economy by the time of the early Italian Renaissance.