Question

explain the loan activity of banks

Answer 1

1)people who have surplus money deposits it  in the  bank and get some amount of interest with them.

2)banks keep only a small amount of their deposits as cash with themselves.

3)banks use the major portion of the deposits to extend  loans and earn rate of interest from those who take loans.

4)banks mediate between the depositors and the borrowers and also earn their income through this process.