Running an army has always been a complicated business. Even before a soldier reaches the battlefield, enormous organisational and administrative challenges have to be met. Many have a financial aspect. Wages have to be paid; clothing and equipment procured and distributed; pension claims processed. In Britain in the 18th and 19th centuries, many of these duties were handled by civilian agents, who drew their income from commission paid by the government for undertaking such work.
As time went by, the agents expanded their business by offering personal banking services to the army officers whose wages they paid on behalf of the government. They gradually evolved into bankers who specialised in this specific group of customers. This transition was accelerated in the late 19th century, as army reforms significantly reduced the range of government work available to agents. In 1892 the fee for handling payments was abolished, and army agents became wholly reliant on the banking aspect of their business.
One of the three pay agencies that still existed at the end of the 19th century was Holt & Co, which later became a constituent of RBS. Its name survives today as Holt's Farnborough branch of RBS, which still has close ties with the military, although the pay agency system itself was finally abolished more than 40 years ago.
For Holt's and the other military agencies, the First World War brought an unprecedented increase in workload. Although army officers no longer had to be clients of these firms, the majority still preferred the traditional and specialised services they offered. The commissioning of many thousands of new officers into the army meant a parallel growth in the agents' customer lists. Holt & Co - not the biggest of the army agencies - saw its number of customers peak at 35,000 during the war, compared to just 1,600 three decades earlier. It served 24 army units, including 6 cavalry and 11 infantry regiments, the Tank Corps and the Royal Defence Corps. By the end of 1917 it took over 200 clerks to manage its pay work alone, compared to a total staff of 40 before the war.
The complexity of business increased, too. Customers were being posted overseas, often to dangerous places. Their financial needs could be unpredictable. Facing the possibility of their own deaths, they had to plan for the financial future of dependants. And their opportunities to discuss these matters with their bankers face to face were severely limited. They might have only an hour or two as they passed through London on their way to or from leave. Many pay agencies recognised the problem and extended their opening hours to cater for them, in some cases opening seven days a week and cashing cheques around the clock – an unprecedented move in banking.