Birmingham Corporation Savings Bank:
The basic feature of the system employed by the Birmingham Corporation Savings Bank from its inception in 1916 was the use of coupons
as a means of saving. Section 8 of the Bank's Rules was headed 'Method of joining Bank' and detailed the system that was employed:
(a) No person shall be eligible to be a depositor at the bank except a person in the employ of some other person in the city of Birmingham
who is prepared to co-operate with the committee in regard to the making of deposits by or on account of his employees in accordance
with the Act and these rules.
(b) All deposits at the bank shall be made in Birmingham Corporation Savings Bank coupons
(herein after referred to as coupons), which shall be of value of 1s. or a multiple of 1s., and shall be purchasable from the bank
by any employer direct or obtainable by him through any bank in the city from whom he desires to obtain them, and for that purpose
any such other bank shall be supplied with such coupons by the bank on terms arranged with the committee.
(c) The coupons
shall not be transferable or negotiable.
(d) Any person eligible and desiring to become a depositor (hereinafter referred
to as the depositor) shall, in a form prescribed by the committee which shall be supplied by the bank to the employer, authorise and
request his employer to pay to him a specified amount of his wages in coupons instead of in cash until such time as he revokes or
varies the authority in the prescribed form.
(e) On receipt of such request and authority the employer shall be entitled
to pay to the depositor the specified amount of wages in coupons, and the depositor shall accept such coupons in lieu of cash.
(f) The depositor shall affix all coupons received by him to a coupon card (the form of which shall be prescribed by the committee),
which shall be supplied by the bank to the employer, and by the employer to the depositor. Each coupon card shall be numbered by the
bank before issue, and a record of the name of the employer to whom it is issued shall be made. The depositor shall sign his name
on the card and fill in his address thereon. The name of the employer shall also be entered on the card.
(g) When coupons
to the value of £1 have been annexed to the card the depositor shall take the card to the bank or a branch thereof, and an account
shall thereupon be opened at the bank in the name of the depositor, and a depositor's pass book issued to the depositor with a coupon
card for further savings. The depositor, on opening an account at the bank, shall furnish a specimen of his signature.
for a coupon method of saving was proposed by Councillor Eldred Hallas who suggested this method because employed persons (the only
class of people allowed to participate in the saving scheme) were familiar with the stamping of contribution cards since the introduction
of health and unemployment insurance in the National Insurance Act, 1911. The scheme had the obvious advantage of the worker committing
to regular deductions from the weekly pay packet. His suggestion for this method of saving may have also been influenced by a 'War
Savings Coupon' scheme that was operated by the National War Savings Committee. This Committee encouraged the setting up of local
associations in April 1916 that became a very popular vehicle for small savings. Coupons at the value of 6d (Sixpence) were sold through
the local associations, and when 31 had been collected, and affixed to a 'War Savings Card' these were exchanged for a 15/6d (Fifteen
Shillings & Sixpence) War Savings Certificate. After 5 years, the certificate's value would have increased to £1. A similar scheme
seems to have operated through the Post Office based on the purchase of 6d postage stamps.
The National War Savings Committee co-operated with the Bank's scheme as shown by this letter dated September 8th 1916, received by
Birmingham Town Clerk (E V Hiley) from the National War Savings Committee:
Your letter of the 6th instant has
duly reached me and has been put before our Chairman. He is quite prepared to fall in with the views expressed in it and wishes
me to state that our Committee will supply the forms, coupons etc., needful to the Birmingham Bank.
I quite see that it will
not be possible for Birmingham to adopt our coupons and we must have some struck specially for you. While on the subject, I should
like to hear from you of what denominations you would wish them to use. Naturally, we should prefer that they would be of as few distinct
values as possible.
I feel sure, from what you say, that Birmingham will do all that is in its power to further the object we
have in view outside the scope of its own operations through its own Bank. I shall be glad to hear further from you on the subject
R H Fox
The method that actually evolved following the formulation of the Bank's Rule 8 detailed
above, was described by J P Hilton in his book, Britain's First Municipal Savings Bank
in a Chapter entitled The Coupon Method
. That Chapter's straightforward description of how the system worked gave few hints relating to any problems encountered,
except for the difficulty of cashiers "arriving at [a] balance owing to the waywardness of a coupon".
Although the basis of the
originally introduced scheme was for a coupon card with twenty spaces to be filled with 1/- (One Shilling) coupons to produce savings
of One Pound, an early report produced by the City Treasurer (in March 1916) had proposed values of 1/-, 2/-, 5/-, and 10/-.
Once the Bank was established, it soon became necessary to produce coupons of a variety of values. Eventually, five values were
used, from Sixpence to One Pound
Some of the issues relating to the production and use of the coupons were discussed by the
Bank's Management Committee at the following meetings:
September 28th 1916:
The Treasurer submitted his report:-
Treasurer reports that he has received 100,000 Coupons of 1/-, value £5,000. He has distributed an instalment of the Coupons to the
various Banks, as under, namely:-
| Lloyds Bank Limited
| London City & Midland Bank Ltd.
| Barclay & Co. Limited
Provincial Bank of England Limited
| Capital & Counties Bank Limited
| London County & Westminster
| London & Provincial Bank Limited
| Parr's Bank, Limited
| Union of London &
Smith's Bank Limited
The Treasurer suggests that he be formally authorised to open accounts with these Banks, and to make the necessary arrangements with
reference to advices, &c.
The Treasurer recommends the Committee to authorise the following procedure:-
In the case
of employers not drawing their money to pay wages direct from a Joint Stock Bank, they may apply to the Head Office of the Savings
Bank for a supply of Coupons, for which they would pay cash over the counter.
Before issuing the Coupons in such cases, it would
be necessary for the employer to obtain application forms (Form A) from the Savings Bank. When these have been filled up and signed
by the employee, the employer would be entitled to obtain the requisite Coupons as indicated above, but on first request being made
by the employer for coupons under the provisions for this rule, the Application Forms (Form A) should be produced at the counter.
is understood that if an employee cannot afford to contribute so much as one shilling per week, there is nothing in the rules to prevent
the application being made fortnightly or monthly.
(The Committee resolved that the Treasurer be instructed to open accounts
with the Banks named by him, also to make arrangements with Farrow's Bank and the Bank of England, who had not so far been approached.)
The City Treasurer included the following in his report to the Committee, regarding Corporation employees:
with the supply of coupons to officials of the Corporation who wish to open accounts with the Savings Bank, and whose salaries are
paid by cheques, the Treasurer proposes that, after application forms from them have duly been filled up and signed, the officials
in question may purchase from the Cashier in the Treasurer's Department the coupons they require. In the Education Department the
whole of the salaries are payable in cash on presentation of forms of receipt at various Branches of Lloyds Bank, the Bank having
been previously provided with lists of the amounts payable. In these cases it would be competent for the officials to obtain from
the Bank coupons in part payment. The lists should be marked in such a way as to distinguish those officials who, having filled up
application forms, are entitled to coupons, and those who are not entitled.
The Treasurer also reported that the amount received
in respect of the sale of coupons and copies of the Bank's regulations, in the first trading period from September 29th to October
7th, was £302. 1s. 10d. This sum resulted in the following balances being held by the Joint Stock Banks:
| Lloyds Bank Limited
142 - 13 - 10
| London City & Midland Bank Ltd.
72 - 4 - 0
| Barclay & Co. Limited
76 - 1 - 0
| National Provincial Bank of England Limited
| Bank of England
& Counties Bank Limited
3 - 0
| London County & Westminster Bank Limited
| London & Provincial Bank
1 - 0 - 0
| Parr's Bank, Limited
9 - 4 - 0
| Union of London & Smith's Bank Limited
16 - 0
October 19th 1916:
The Manager having suggested that the Bank should supply strong envelopes to depositors to enable them to
keep their coupon cards or passbooks in, the Treasurer made application to the National War Savings Committee for a supply of 5,000
envelopes, but was informed that the Treasury had vetoed the idea. Accordingly, the Treasurer reported that he had placed an order
locally for the envelopes. The Treasurer also stated that 10,000 coupon cards that had been ordered were due for delivery on October
After sales of £302. 1s. 10d. in the period to October 7th, the Treasurer reported that balances held one week later were
now £704. 15s. 10d:
At the next meeting of the Management Committee, held on November 29th 1916, the Treasurer presented six weekly reports covering the
period from October 14th to November 25th. These reports showed total sale of coupons as £10,557. 16s. 0d. Of this sum, the Bank had
invested £9,900 with the National Debt Commissioners:
- November 2nd: £3.000
- November 9th: £1,500
- November 16th:
- November 23rd: £3,300
With regard to these investments, however, the Treasurer had received an 'unofficial' letter
from a Mr G F Ansell, of the National Debt Office, pointing out that it would be convenient if future investments were made in multiples
of £1,000, as the Commissioners employed the money to purchase Treasury Bills of £1,000 each.
At this date, the coupons were
being sold with values of 1/- and 5/-, but with many employers having expressed a wish to have a supply of £1 coupons, 10,000 coupons
of this higher value were ordered. The War Savings Committee were also asked to supply 10/- coupons, but declined to do so. In these
first few weeks, the value of coupons received from the War Savings Committee was £50,025 (5/- value: £25,400; 1/- value: £24,625),
but the quality of some of them was criticised by the Manager as being susceptible to forgery and that they were "very faulty indeed
and considerable annoyance has been caused not only to employers and depositors, but also the Joint Stock Banks by the sticking together
and consequent defacing of the coupons. The last supply of 1/- coupons were in a different shade of green to the previous supplies".
As a consequence, an interview was held with officials of the War Savings Committee at which the officials stated that they were considering
a means whereby a secret mark or watermark might be introduced to minimise the danger of counterfeiting. In June, the Manager was
authorised to destroy faulty coupons to the value of £82. 16s. 0d.