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It is called a loan.
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∙ 9y ago
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What do banks use depositors money?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
Why do banks pay interest on your savings account?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
When do you get interest from the bank?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
Banks pay their costumers interest on the money in their accounts for what reason?
Banks pay their consumers interest on their money in their accounts because, the same money is what the bank use to lend loans to other customers. As they are going to earn an income through the interest they charge the loan customers, banks give a portion of that interest as interest for the customers who have deposited their money with them.
Why do banks need to manage liquidity risk?
Because there is no telling how many customers would want to withdraw their money from their bank accounts on any given day. Banks use the deposit money to lend loans and makes a profit. If they lend too many loans, they may not have money to meet withdrawal demands. So banks have to maintain their liquidity position in a strong way.
Where did the bank gets its money to lend?
They get it from the other Banks customers accounts i think!
What do banks use depositors money?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
Why do banks pay interest on your savings account?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
What is it called when banks lend money to businesses?
Workers and Businesses
When do you get interest from the bank?
The bank customers share of profit made on loans by the bank is called the "Interest". It is the money the bank pays the customer for having their money deposited with the bank. As you know, the bank earns an interest income from loan customers for the money they lend them, and since this money they lend is taken from the deposits placed by customers, banks share the profit by paying an interest to the customer who has placed the deposit with them.
Banks pay their costumers interest on the money in their accounts for what reason?
Banks pay their consumers interest on their money in their accounts because, the same money is what the bank use to lend loans to other customers. As they are going to earn an income through the interest they charge the loan customers, banks give a portion of that interest as interest for the customers who have deposited their money with them.
Who lend money?
Money lenders and banks.
Raising the discount rate to members banks will in turn cause the member banks to raise interest rates to their own customers?
Prime Rate ---- the rate at which banks lend money to each other and the Federal Reserve lends money to banks
Who can lend you money for a house?
people at banks
Why do banks need to manage liquidity risk?
Because there is no telling how many customers would want to withdraw their money from their bank accounts on any given day. Banks use the deposit money to lend loans and makes a profit. If they lend too many loans, they may not have money to meet withdrawal demands. So banks have to maintain their liquidity position in a strong way.
Do banks lend out money that you deposit to make a profit?
Yes, banks take your deposit and combine it with all the other deposits and loan it out. Some banks lend it mainly to home buyers and car loans, while others emphasize business and commercial loans. The bank has to keep a certain percentage of your money available at all times. Banks actually borrow money from other banks and institutions to get enough money to loan to customers. It is a very funny business overall.
To whom does the Fed lend money?
other banks.
