The accidental banker
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E-mail China Daily, June 23, 2015
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Taihang Mountains in Shanxi. (Photo by Pete Marchetto/For chinadaily.com.cn) |
Not that it was money in our present-day understanding of notes and base-metal coins. Instead, varying sizes of silver ingots served as currency and as a means of capital transfer. In a shape not dissimilar from that of the simple origami boat beloved of small children, this is the object you may see on many a Chinese souvenir stand, held aloft by the Buddha as a symbol of prosperity.
As the business grew, so the means of transfer became increasingly sophisticated. The bills of exchange took on many of the aspects we would recognize today as a check: the recipient's name, the date, amounts in columns for units, tens, hundreds and on up are instantly recognizable. The bills were even watermarked.
As an additional security measure, they were further imprinted with a code the bank would change regularly to reduce the risk of forgery still further. Li the dyer, now Li the banker, developed many ideas that are now familiar in banking the world over. In doing so, he left his earlier days as a successful dyer behind him in becoming a still more successful purveyor of financial services.
He was not without competitors. Pingyao's financial services sprouted into an industry in the town as word spread. Other towns and cities were slower to grasp the financial revolution Li had precipitated. But in Pingyao, rival exchanges were set up to spread their own branches around the country, including one founded by Li's own business partner after the two fell out over the approach the Rishengchang Exchange was taking.
Thus this faraway town in the middle of nowhere, Pingyao, became for some time the financial hub of all China, as important in its time as Shanghai or Hong Kong are in China today.
No success is eternal, however. With the coming of the 20th century new methods of financial trading were developed, and it became increasingly important to have financial centers located alongside other trade and commerce. So it was that, 108 years after its founding, the Rishengchang Exchange fell out of favor and into bankruptcy. With the demise of its other exchanges, Pingyao returned to its former days of being just another town of little significance in a province far away from the nation's vibrant commercial centers.
That demise was to bring an unexpected positive benefit to those of us in the 21st century. Over a century of prosperity served Pingyao well. It helped maintain its substantial city walls and ensured the quality and resilience of its buildings. The demise in its prosperity was to bring Pingyao's development to an abrupt halt, freezing that heritage in time from nearly a century ago, perfectly preserved as a testament to its bygone days of fortune.
The modern visitor may see the Rishengchang Exchange set in Pingyao's unique surroundings and be thankful for the rise of the bank, which made Pingyao's preservation possible.
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