What is a bank in simple words?
A bank is a financial institution that helps peoples, organizations, and businesses securely deposit their money into bank accounts. Furthermore, banks provide services to transfer money to other cities and banks. Moreover, these banks lend money to people and businesses on interest. Hence, banks pay a key role in the financial growth of the countries.
When was the bank invented?
The idea of banks started around 1800 BC in Babylon when wealthy people became moneylenders and started lending money to other people. The modern banking system has its roots in the 17th century when goldsmiths started lending money to people.
Where do banks keep cash?
Banks keep money into vaults which are secure rooms. Furthermore, local banks keep money into the accounts managed at local Federal Reserve banks due to security and profit reasons. However, the money required for urgent needs and usual needs remains in the form of hard sorted cash in the bank.
Who started banks?
The modern banks have their roots in the practice of goldsmiths of London, who started lending money to people in the 17th century. Later on, this practice was widely used and in 1695, the Bank of England became the first bank to begin the permanent issue of banknotes.
Why do people join banking sector?
People join the banking sector due to huge growth opportunities in the banking sector as a trainee banker can soon get managerial posts based on performance. Furthermore, banks lure human resources by offering various financial benefits including home loans, vehicle loans, etc on a discounted interest rate.
How do banks play an important role in the economy of the country?
Banks play an important role in the economy by increasing people’s savings and lending money to businesses and people in need. Hence, they provide key funds that are used as instigators of the economy. The economic activity created by these loans further boosts the economic growth of the country. Hence, banks play a key role in the economic growth of a country.