Definition
The banks are a crucial part of any economy. It has many uses: from depositing money to giving out loans
Working of a bank
- The depositors deposit their money, and receive small interests
- The bank uses that deposited money to extend loans, and then receive higher interests from the borrowers.
- The difference between the interest coming in and going out is the income of the bank.
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Flashcards
What is the working of the bank? ?
- The depositors deposit their money, and receive small interests
- The bank uses that deposited money to extend loans, and then receive higher interests from the borrowers.
- The difference between the interest coming in and going out is the income of the bank.