nducted and supervised and properly
safeguarded by law, such notes will circulate freely through the
length and breadth of a country.

Checking accounts meet in the most satisfactory manner all currency
needs for which hand-to-hand money is not well adapted, such as large
payments and payments at a distance. With a few strokes of a pen
payments of the greatest magnitude can be made through their agency.
Checks can be sent through the mails at slight expense and without
danger of loss of the amount involved. By the devices known as
travelers' and commercial letters of credit, checking accounts supply
the most convenient form of currency for travelers and for merchants
engaged in foreign trade.

Besides bank notes and checking accounts the only forms of currency
needed in any community are standard and subsidiary coins, the former
for use as ultimate redemption material for all other forms of
currency and for the payment of international and other balances, and
the latter for small change. Even these forms of currency are supplied
by commercial banks, but since they do not create them, ways and means
of procuring them in the quantities needed constitute one of their
peculiar problems.

_5. Collections_

One of the most important functions of commercial banks is the
collection for their customers of checks and drafts drawn on other
institutions. When these documents are received, the accounts of
customers who deposited them are credited with the amounts, less a
small fee for collection, unless by agreement this service of
collection is performed free of charge. The checks are then assorted
according to the banks upon which they are drawn and the cities in
which those banks are located.

Checks drawn upon home banks are collected either through messengers
who present the checks at the counters of the banks upon which they
are drawn and secure payment therefor, or through the local clearing
house. This is a place where representatives of the banks meet for the
exchange of checks. After the representative of each bank has
distributed all the checks held by his institution against the others
participating in the clearing, and received from them those drawn
against his bank, a balance sheet is prepared showing the balance due
by or to his bank after the total of the checks distributed has been
balanced against the total received. If said balance is adverse, it is
paid to the master of the clearing house, and if it is f