What is the role of BANKING in an economy?I have seen many solved questions of how BANKS play a role on an economy, but there is a difference between bank and banking right? please help. | |
What is the role of BANKING in an economy?I have seen many solved questions of how BANKS play a role on an economy, but there is a difference between bank and banking right? please help. | |
Bank is a financial institution offers various financial services to its clients.
Banking right explains the right to avail services offered by banks by all.
Role of banking : Banks plays various roles:
* Keeps money and lend money.
*Mobilize saving for investment
* Helps to develop industries, agriculture and commerce .
* Work as an adviser to individual or corporate to invest or manage money related matters.
* Give educational loan to student to build up career.
* Help the Central bank to apply monetary policy.
* Deals wit foreign exchange.
and so on.
Banking allows both for the safe storage of money (sometimes with interest) and also coordination of the market for loanable funds.
What banks do is accept money from people who want to save the money and find people who want to borrow the money. This is essential in a modern economy - it allows for investment, which in turn increases capital accumulation, productivity, and standard of living.