All foreign business was done exclusively through foreign banks, and a large amount of Chinese money also found its way into their coffers - mainly from the point of view of safety and security. At any time, as even to-day, a large portion of the Chinese money in the vaults of the foreign banks was anxious for profitable employment. When the Chinese banks approached them they naturally jumped at it - only so long as the danger and risks were minimised as much as possible. An arrangement was arrived at by which the different native banks were to have certain amounts on loan - according to the standing and credit of each bank - from day to day. This was clean credit and corresponded to "call money" in Europe. The pecularity of this loan is that it might be called in at any moment by the lenders, it thus being understood that the borrowers should be able to pay back the amounts within a few hours of the call. It might be asked: - if the native banks resorted to the foreign banks for working capital, how could they pay back when "called?" If the native banks borrowed the money and employed it in trade, it is very probable that they would not be able to pay back when called. It does not usually happen, however, that the foreign banks call in their loans without sufficient notice. Secondly, chop loans, which are necessitated by the trade in imports are usually set off by the cheques given to Chinese dealers by foreigners who obtain export goods from them. These balances are struck from day to day and hence the adjustment is not so difficult as it may appear at first sight. Thirdly, even should one native bank not be able to adjust a chop loan to a foreign bank or be not able to pay up when called, it can always raise a loan from another bank on the security of goods, and so meet its obligations and maintain its credit.*
* This was due partly to the transference of the deposits of official money to the so-called Provincial Government hanks.