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The banks in their 1_______ form gradually evolved in England, where the 2_______ men used to deposit their cash and other valuables with the goldsmith for safe custody. These goldsmiths learnt out of experience, that out of the total deposits, hardly more than ten per cent were withdrawn by the depositor on any day. Therefore, if they had kept about ten per cent reserve cash to meet the 3_______ from the depositors, they would have loaned the remaining amounts to borrowers earning interest out of these loans. This gradually became a regular practice and they started paying a small interest to depositors to 4_______ more deposits. Out of this system the modern institution of Banking developed.