Have you ever thought about how a bank earns money ?
Unless you have a problem with a debit card, open a new account or want a loan, you would never like to visit a bank. After that, we don't even know what happens. Am I right ?
My salary comes from the bank. I deposit money and withdraw it. What kind of benefit do banks get because of this ?
How the banks run, they keep all my money safe. How are they profitable ?
Do these questions keep coming into your head ?
Yes, let's understand how banks make money.
The banking system is one of the important aspects of our wealth. The amount of money which you deposit will be given to others.
* Yes, others through loans with higher interest rates. The more deposits happen, they try to give better loans. It is the major source of their profits.
*Have you seen messages on your phones regarding bank messages or emails? They do charge quarterly or yearly for the services they are provided for safeguarding and informing the bank details.
*Debit card and credit card transactions and the allocation of new cards in case of new ones.
*Minimum bank balance charges and failed transaction charges.
*Banking fee for monthly maintenance and ATM usage.
*Late payments on EMI’s.
*Foreign transaction charge, when you transfer money to your friend who is abroad studying.
This is how they earn and the banking model works by protecting our wealth. The banking system is complex and has constant pressure and misunderstanding. It is basic awareness to learn regarding financial systems, to have a safe financial journey, while going to banks. Banking knowledge would increase our capacity to have monetary awareness.
