Just to make sure that there isn't a semantic misunderstanding, "one bare wire" does not mean one single strand of copper from a braided wire. Put the whole thing in there (i.e. whatever you would have connected to a single banana plug).
I did that type of connection for many years. I even did it on a Yamaha receiver prior to getting banana plugs when I got my latest set of speakers. In fact, that Yamaha was the first receiver that I ever owned that would allow any type of connection except for the one that you mentioned. As Alex said, it's common and reliable. Banana plugs cause additional electrical resistance, so they aren't for a better connection - they are for convenience. Personally, I find banana plugs very convenient.