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MODEL POLICY on BANK DEPOSITS Bank of India  Form

MODEL POLICY on BANK DEPOSITS Bank of India Form

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Hello, friends! All of us save our money in banks. And these banks pay us interest on our savings. They give us more money. So have you wondered how these banks earn money? In today's video, let's understand the Business Model of Banks. Think about it, what do banks do with your money? It can't be that banks will take your money, keep it in a gigantic locker, lock it and keep the keys safely, and the money would remain in the locker safely. This is the version shown in films. It's not so in reality. Banks use your money to give loans to others. And the interest that they charge on that loan, is their earnings. Let's understand this with a simplified example. This is a bank. There's only one customer in this bank. You. You deposit ₹100 with the bank. And this bank pays you interest at 4%. Presently, this is the rate of interest for the Savings Account, 4% per year. Your ₹100 is now with the bank. The bank then gives out this ₹100 to

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