How are deposits with the banks beneficial for individual as well as for the nation?

CBSE Class 10 CBSE Class 10 Social Science
,
1

How are deposits with the banks beneficial for individual as well as for the nation? Explain with examples.

2

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
    . irrigation.
  • The banks are the backbone of the country’s trade.
  • Banks provide employment.