bank

BANK

BANK are closely concerned with the flow of money into and out of the economies. They often cooperate with governments in efforts to stabilize economies and prevent inflation. They are specialists in the business of providing capital, or in allocating founds on credit. Banks originated as place to which people took they valuables for safe-keeping, but today the great banks of the world have many functions in addition to acting as guardians of valuable private possessions.

Bank normally hold customer money in two distinct forms, a customer can issue personal cheques. No interest is paid by the bank on this type of account. With deposit account, however, the customer undertakes to leave his money in the bank for a minimum specified period of time. Interest in paid on this money

The bank in turn lends the deposited money to customers who need capital. This activity earns interest for the bank and this interest is almost always at higher rate than any interest which the bank pays to its depositors. This is way banks make most of their profit