Thus, suppose three bankers--Mr. Smith, Mr. Brown and Mr. Robinson. I bank with Mr. Smith, and sign a cheque in favour of Mr. Jones who banks with Mr. Brown, because I owe Jones a bill which I can thus pay. I also sign a cheque in favour of Mr. Harding (that is, to the order of Mr. Harding), to whom I also owe money. He banks with Mr. Robinson. Meanwhile Harding perhaps owes money to Jones and pays him a cheque ordering Mr. Robinson (Harding’s banker) to pay Jones a sum of money. Jones hands this over to his banker, Mr. Brown. At the end of a certain time--say, a month--the three bankers, Smith, Brown and Robinson, get together and compare the various cheques they have received. It is obvious that a great many will cancel out. For instance: I have given Jones a cheque for £20 which Mr. Smith, my banker, has to pay to Mr. Brown, Jones’s banker. But Mr. Brown has a cheque of Mr. Harding’s asking Mr. Robinson to pay £20 to Jones, and Jones has given that to Brown too. Meanwhile Jones has given me a cheque later on, for something which he owed me, of £10. The bankers compare notes and see that Smith need not pay £20 to Brown, and then ask Brown for £10. It is simpler to pay the difference only. Mr. Smith hands to Mr. Brown what is called the “balance.” The difference between £10 and £20 is £10, and Brown hands over £10 to Smith. At the end of another month perhaps it is Robinson, Harding’s banker, who finds that on comparing notes he has a balance against him of £10 to Brown: and so on. When dozens of bankers came to be established with thousands of clients, or “depositors,” the convenience of this system was overwhelming. There would perhaps be in a week as many as 10,000 cheques out, and instead of having to make 10,000 separate transactions of paying from Brown to Smith, Smith to Robinson, Robinson back to Brown, and so on, through dozens of bankers, the cheques were compared and only the balances were paid over--or, as the phrase goes, “cleared.” The Clearing House was the place where all the cheques of different banks were put in at regular intervals and compared one with another, so as to see what balances remained over, owing by particular bankers to others.