All hackney coaches and stage coaches in all the realm became required to be licensed. The turnpike system came into use. Tolls were paid for road upkeep and repair by private companies. The local parishes ceased to have this responsibility. John Ogilby wrote the first road book based on actual surveys of the roads. Stage coaches cost a shilling for every five miles and went 40-50 miles a day. The trip from London to Oxford was twelve hours. The company of Coach and Coach Harness Makers was founded with the consent of the king. The body of a coach hung from the frame by leather braces. One axle pivoted for turns. Plate glass was used in the windows. Rivers improved so that most places were no more distant from navigable waters than a long day's haul on land.
The several post offices were put under the authority of one Postmaster General appointed by the king for the purpose of speed and safety of dispatches, which were carried by horseback. One sheet letter going less than 80 miles cost 2d., and more than 80 miles, 4d.
When the army was disbanded after the Restoration, its officers and soldiers were allowed return to their trades and their apprenticeships without serving the usual seven years. Parishes were required to provide for poor and maimed officers and soldiers who served Charles I or Charles II. The Royal Hospital founded by Charles as a home for veteran soldiers opened in 1692. Greenwich palace was converted to a hospital for seamen and their widows and children to encourage men to become seamen: mariner, seaman, waterman, fisherman, lighterman, bargeman, keelman, or seafaring man in the king's Navy. Also, disabled seamen's children were to be educated at the expense of the hospital.
Charles retained one regiment from which he started a small standing army, which slowly increased in size ever after. The army was primarily mercenary, as it had been in medieval times, with officers buying their commissions. Colonels were the proprietors of their regiments and captains were the proprietors of their companies. The soldiers were ill mannered, swearing and cursing and stealing, sometimes from peoples' homes, and intimidating people with their swords. The bayonet was invented to attach onto a gun, which were muzzle-loading with a match lock. So pikemen with their long spears became obsolete. Hand grenades and small explosive bombs came into use about 1670. Explosives were also used in mines.
There was resort to many devices to fund wars. The land tax was still the primary tax. The customs and excise taxes were often extended to more goods and wares. Sometimes there were duties imposed on marriages, births, and deaths. Also, hawkers, peddlers, and other trading persons going from town to town to other men's houses on foot or on horse carrying wares had to buy a license. There were also loans from privileged companies such as the Bank of England, East India Co., and the South Sea Co. Commissioners were appointed to take and state the account of all money in the public revenue. This discouraged the prevalent corruption of government officials and thereby the people were encouraged to pay their taxes.
The Goldsmiths loaned money to the king and to private persons and to the Exchequer. Receipts from Goldsmiths for storage in strong boxes had become a de facto paper currency. But when the Goldsmiths had no more money to lend, the Bank of England was founded in 1694 under whig auspices to provide money for war. It was the first institution to issue notes in excess of its total deposits. However, it was not allowed to lend money to the Crown without the consent of Parliament. It was incorporated as the first English joint-stock bank and had about 1,300 shareholders. These original subscribers were individuals from London from many walks of life, including well-to-do tradesmen and about 12% of whom were women: wives, widows, or spinsters. Not many corporations were original subscribers. Holders of at least 500 pounds could vote, of 2000 pounds could be directors, and of 4000 pounds could be Governor. The Bank issued notes payable to bearer and discounted bills, but these were not legal tender. It lent at 8% to the Crown and occasionally to corporations. Money was also borrowed by offering annuities on single lives. This was the first time the government borrowed directly from the public on a long- term basis.
In 1695 there was inflation due to over issue by the Bank because of inexperience, pressure from government, and the Bank's greed for business. After a dividend of 5% in 1695, the next year there was no dividend and so the bank stock price fell. In 1696, five pound and ten pound short term bonds were sold to the public. Also in that year was the first run on the bank. This occurred two days after clipped money lost currency; people wanted the new recoined money, but the Mint had not supplied the Bank with sufficient supplies. Interest instead of cash was given for notes. Cash was short for months. The Bank's credit was much shaken. It was then given a monopoly so that its notes would not have competition. Thereafter, its dividends were good - about 12% per year. Because of its monopoly, its dividends were about 3% above the current going rate of interest. About this time, Exchequer Bills, with interest, were started by the Exchequer and circulated by the Bank of England. They were frequently endorsed many times by successive holders.
The Bank simply took over from the goldsmiths its main everyday business of deposit; running cash note [cashier's note, specie note, cash note], which was payable on demand and normally did not bear interest; and drawn note [precursor to the check, but not on special paper]. The Bank gradually convinced many of its clients to use its "check" [cheque] paper when drawing. The check paper was unique to the Bank and embellished with distinctive scroll work to serve as an obstacle to fraud. Over time the running cash note tended to be for round sums of at least twenty pounds and multiples of five pounds. The Bank of England had a monopoly on issuing notes in the London area. Country banks arose and issued bearer notes payable on demand and interest-bearing notes in their areas. The Bank of England gave to its depositors the service of paying annually to a designee without further order.
A decision of the common law courts held that bills of exchange (written orders to pay a given a sum on a given date) were transferable to other people by successive endorsements. So long distance payments no longer had to be made in coin, with all the dangers of highway robbery.
The financial revolution of the 1690s meant that the merchant elite could invest in government bonds or company bonds at 5-6%, or London leases at 10%, as opposed to income from landed estates, which was under 3%. Shareholders were no longer personally liable for company losses. Interest on loans was no longer considered sinful as long as it was not oppressive. The greater ability to borrow spurred the growth of capitalism.