early 15c., negotiacioun, "a dealing with people, trafficking," from Old French negociacion "business, trade," and directly from Latin negotiationem (nominative negotiatio) "business, traffic," noun of action from past participle stem of negotiari "carry on business, do business, act as a banker," from negotium "a business, employment, occupation, affair (public or private)," also "difficulty, pains, trouble, labor," literally "lack of leisure," from neg- "not" (from PIE root *ne- "not") + otium "ease, leisure," a word of unknown origin.
The sense expansion from "doing business" to also include "bargaining" about anything took place in Latin. Meaning "mutual discussion and arrangement of the terms of a transaction or agreement" is from 1570s.
also clearinghouse, 1805, from clearing + house (n.). The original was established 1775 in London by the bankers for the adjustment of their mutual claims for checks and bills; later the word was extended to similar institutions.
CLEARING, is a method adopted by city bankers, for exchanging the drafts on each others houses, and settling the differences.—Thus at a stated hour in the afternoon, a clerk from each attends at the Clearing House, where he brings all the drafts on the other bankers, which have been paid into his house during the course of the day; and, having debited their different accounts with the articles which he has against them, he deposits them in their proper drawers, (a drawer being here allotted to each banker:) he then credits their accounts respectively, with the articles which they have against him, as found in his drawer. Balances are then struck on all the accounts, and the differences are transferred from one to another, until they are so wound up, that each clerk has only to settle with two or three others, which is done in cash, or Bank of England notes. [P. Kelly, "The Elements of Book-Keeping," London, 1805]
The name is from Proto-Germanic *Langgobardoz, often said to mean literally "Long-beards" (see long (adj.) + beard (n.)), but according to OED the second element is perhaps rather from the proper name of the people (Latin Bardi). Their name in Old English was Langbeardas (plural), but also Heaðobeardan, from heaðo "war."
In Middle English the word meant "banker, money-changer, pawnbroker" (late 14c.), especially a Lombard or other Italian trading locally, before it was used in reference to the nationality. The name in Old French (Lombart, Lombert) also meant, in addition, "money-changer; usurer; coward." Lombards were noted throughout medieval Western Europe as bankers and money-lenders, also pawn-brokers. French also gave the word in this sense to Middle Dutch and Low German.
London's Lombard Street (c. 1200) originally was the site of the houses of Lombard (and other Italian) bankers, who dominated the London money-market into Elizabethan times. An old expression for "long odds, much against little" was Lombard Street to a China orange (1815, earlier to an egg-shell, 1763).