House of Medici history: Throughout the 15th century, the name of an Italian banking family was synonymous with power. They were the Medici, who, through their loans, wielded great political influence and financed great works of the Renaissance.
In 1429, Cosimo de’ Medici and Lorenzo de’ Medici inherited the banking business of their father Giovanni, whose loans would pay the salaries of the armies and the construction of public works. All this without forgetting the active role of the Medici family in the world of art, where they distinguished themselves as the great patrons of the Renaissance. This was probably the most influential Italian family of the 15th century.
The growing importance of commerce and the bourgeoisie allowed the banking industry to emerge strongly. The introduction of techniques such as the double-entry bookkeeping and credit instruments such as the bill of exchange also contributed to the expansion of the banking business.
What kind of banking activity did the Medici conduct?
Beyond the history, it is worth analyzing the efficient, serious and prudent management carried out by Cosimo de’ Medici.
Thus, the Florentine banker ended up establishing branches all over Europe, in cities such as:
With Florence serving as the nerve center, the risk and losses that could be taken on by the other branches were controlled and they had a considerable degree of autonomy. It should be noted that the Rome branch would conduct a large volume of business because of its substantial economic relationship with the Vatican.
But if we look at the banking activity of the time, what kind of bankers were the Medici?
In 15th century Italy, one could find:
- Money changers
- International bankers
Thus, moneylenders were usurers and had to pay a fine every year in order to continue their business and avoid further penalties. Money changers traded in jewelry, changed money, and could handle deposits.
Finally, the Medici would enter the category of international bankers, financing large projects with their loans, which they managed throughout Europe.
Usury and sin
At the time, religious morality was very strict and usury was considered a sin. The Medici wanted to satisfy their economic demands, but at the same time respect the doctrine of the Church.
The interests of the Medici and the Church would eventually align, as the Vatican needed the services of the bank to collect contributions from the faithful across the European continent. On the other hand, when loans were made to the Church, the Church could not be required to pay interest, as the bank would have sinned by practicing usury.
It was precisely in these loans to the Church that the so-called discretionary deposit was born.
Thus, the payment of interest by the Church was made as an incentive or gift. In other words, the payment of interest by the clergy to the bank was not mandatory. In fact, groups of theologians carefully studied contracts with banks to make sure there was no usury.
The great patrons of the Italian Renaissance
As mentioned earlier, greed and usury were frowned upon in 15th century Florence. Therefore, wealthy families like the Medici had to find a way to make their wealth compatible with the doctrine of the Church.
To atone for their sins, the wealthy paid for religious works of art.
In the case of the Medici, it is worth mentioning the example of Cosimo de’ Medici. In 1430, appearing before Pope Eugene IV, Cosimo asked him how he could enjoy the wealth he had acquired and, at the same time, be free of sin. To obtain expiation, Eugene IV proposed to pay for the restoration of the convent of San Marco. By accepting Eugene IV’s suggestion, Cosimo de’ Medici ended up paying a considerable sum for the restoration of the convent.
One might wonder what role the other Medici had as patrons of the arts. While Cosimo, the banker par excellence of the Medici family, exercised patronage in order not to appear ostentatious and to find a certain political and social balance, Lorenzo the Magnificent was the most important patron of the family.
Lorenzo, as an art lover, was dedicated to reviving classical art by creating the school of modern art. Thus, Lorenzo would take under his protection artists such as the famous Michelangelo.
It is worth noting, however, that although Lorenzo was very active in art scene, he was not as efficient as Cosimo when it came to managing the family fortune.
The decline of House of Medici
The decline of the Medici family came after Lorenzo’s death, the dissolution of the bank, and the rise of a fanatical Dominican monk named Girolamo Savonarola.
Believing that the art paid for by the Medici was pagan, Savonarola ordered the burning of numerous works of art. Faced with Savonarola’s assault, Piero realized that the Medici family was in danger and decided to leave Florence. Ironically, it was Savonarola himself who was burned at the stake in 1498 after turning against Pope Alexander VI.
Although they had to go into exile for a time, the Medici exercised significant political and religious influence in Italy. They established themselves as dukes of Florence and some family members even became pope (Leo X). They did not, however, return to the banking business that the family had run between 1397 and 1494.
Among the members of the family, as with Leo X, we can highlight four popes:
- Leo X
- Clement VII
- Pius IV
- Leo XI
- Two French queens: Catherine de Medici and Maria de Medici
- Numerous Florentine heads of state and members of the royal houses of France and England
In conclusion, the Medici family’s influence goes beyond banking, although its main activity and recognition is in banking and patronage. And we are talking about a family that, as our title indicates, established itself as the most important European family of the Renaissance.