“Neither a borrower nor a lender be”: What is a bank?

Home Education Unit Plans Economics through the Long History of America’s First Bank “Neither a borrower nor a lender be”: What is a bank?

“Neither a borrower nor a lender be”: What is a bank?

Considering their ubiquity today, it can be hard to imagine America (or, for that matter, the world) without banks.  How could a person conduct their business or personal affairs?  How could a person save money, purchase a house, conduct any sort of investment without the sort of banking institutions that we have today?  And if those things were possible before the advent of modern banks, how exactly did the banking system and financial world that we have today come into existence?

The Bank of North America is often considered to be the “first” bank in America.  That is why looking at this bank specifically, as well as a number of primary and secondary sources associated with that bank, students will be able to learn about person finance today, the importance of financial institutions, the connections between the financial sector and the American nation, and basic associated economic concepts.  This lesson includes lecture notes and discussion questions to cover these topics.

Essential Questions

How does continuity and change within the United States history influence your community today?
What role does analysis have in historical construction?



Students will be able to:

  • assess the importance of banking within the economy by examining primary source documents relating to early banking.
  • outline the world history of banking by comparing and contrasting to the United States banking history.

This lesson fulfills Economic Standards as well as History ones detailed on the Unit Plan.

Big Ideas

  • Banking, and the influence of the American financial system.
  • Limited resources and unlimited wants require choices by individuals, groups and nations.


  • Each contemporary society/nation must choose which economic system will be used to determine the allocation of the factors of production and the distribution of goods and services.
  • A government's fiscal policy and monetary policy also influence the market in a variety of ways. 
  • A nation's overall economic success are determined by the interaction of the specific economic decisions made by all individuals, households, firms, government agencies, and other actors within a market.


  • Evaluate how different economic systems would develop an economic policy to allocate scarce factors of production in the production and distribution of goods and services.

Other Materials

Primary Sources

From the Bank of North America Collection at the Historical Society of Pennsylvania:

The State of the Bank in the 18th Century

Acts of Incorporation notes, 1781

Bank Charter, December 1781


The History of Banking and the Bank of North America (images from the BNA collection, HSP)


Suggested Instructional Procedures

  1. It is suggested that teachers begin the Powerpoint presentation before giving them the links to the Primary sources. 
  2. It is best if teachers begin this lesson with an "anticipatory set." An examples is offered as the "Bell work" in the presentation:
    1. Have students brainstorm the uses of a bank, e.g. to protect one's money. 
    2. Compile a student-generated list of those different uses, perferrably on a chalkboard or whiteboard. 
    3. This will allow for the deconstruction of the definition of a bank, so that the whole class can see how the modern banking system developed piece by piece.
    4. When going through the presentation, make mention of the uses that your students listed on the board, so as to keep them engaged during the lecture.
  3. Questions relating to the primary sources can be found in the presentation itself.
  4. Since the sources are handwritten, it is perhaps easiest if students can access these sources online or on a computer, as opposed to as a hand-out.  The questions can therefore be answered as a homework assigment.


Bullion: Typically this word refers to bars consisting of precious metals.

Charter: A legal document, granted by the government, that stipulates the incorporation of an institution.

Creditor: The person or institution who is owed money.

Deposit: Money that is kept in a bank.

Debasement: The reduction of something in value.

Interest: A fee charged for the use of money.

Interest rate: The percentage of interest charged on a loan.

Usury: Historically, charging any interest on a loan was considered to be sinful in the Christian religion and was called 'usury.'  Today 'usury' refers to excessive interest rates.