ИСТИНА

This paper deals with one of the principal forms of lending operations - the discount of bills of exchange. Quantitative data are used to study this 19th century banking practice. It has been commonly believed that lending in the Moscow region was controlled by a handful of wealthy textile manufacturers and merchants, who were closely connected by kinship and business ties. This belief lead historians to conclude that the Moscow banking environment was stagnant. However, networks based on kin relationship have always been important for the development of merchant banks. This article revises the interpretation of Moscow banking in a business-network perspective. Business networks lower information costs, which was typical of the 19th century and the only possible explanation for Russian banking, under the conditions of a banking services' deficit.