How are deposits with the banks beneficial for individual as well as for the nation? Explain with examples.
BENEFITS of Deposits to the Individual
- Bank accepts the deposits and pays interest to the depositor.
- Banks encourage and help people to save their money.
- Deposits in the bank are safe.
- People can withdraw the money as and when they require.
- Banks also grant loan to people for a variety of purposes.
BENEFITS of Deposits to the Nation
- Banks charge a higher interest rate on loans than what they offer on deposits the difference is the main source of income of banks.
- Banks use the major portion of the deposits extend loans for various economic activities.
- Bank promote agriculture by providing loan to the farmers who can increase their production by bringing new farm implements and make better arrangements for the
- The banks are the backbone of the country’s trade.
- Banks provide employment.