Clearing-house certificates are made use of in many cities for the
payment of balances by debtor banks. These are issued against gold
deposited with one of the associated banks. They are numbered,
registered, and countersigned by the proper officer, and are used only
in settlements between the banks. Various methods of making
settlements are in use. In some of the cities the balances are paid by
drafts on New York or other money centres. The debtor bank sells some
creditor bank New York exchange, and receives in return a cheque or
order on the clearing-house, which when presented makes the debits and
credits balance. It is estimated that the actual cash employed in New
York clearings is less than one half of one per cent. of the balances.