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Six potential services a bank provides?

Question

Six potential services a bank provides?

 

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Step 1

A bank is a financial institution that accepts deposits from the public and makes loans from these deposits. Hence, banks play a crucial role in mobilising savings from the general public and credit creation in an economy. Banks offer several services. Some of the major services offered by banks are: 

  1. Facilitate deposit creation
  2. Creating Credit
  3. Facilitate wire transfers
  4. Foreign Exchange facilities
  5. Issuing cashier\'s checks and acting as notary public
  6. Brokerage and Custodian services

 

Step 2

1. Facilitate Deposit Creation:

Banks instinctively come to mind when poeple want to earn a bit of interest on any extra money they might have. A deposit in a bnak earns the depositor an interest on the amount deposited. Banks offer a wide range of deposits to suit the neeseds of depositors.Different types of depostis include deposits for checking accounts, savings accounts, interest bearing accouts, money market deposit accounts and Certificates of deposits. By encouraging deposits, banks play a crucial role in mobolising small deposits from many people across the country. Hence they help in aggregating the savings in an economy.

Step 3

2. Creation of credit:

Banks lend the money accumulated through deposits in various forms to individuals and businesses that require credit. They extend lines of credit and overdraft facilities to individuals and businesses. They offer various kinds of loans and mortgage...

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