Question

Explain the process of credit creation by commercial banks 2

Answer 1

Credit is an ability of a customer of banks client to be able to buy goods and services without money.Credits are always given to clients who are trustworthy and the bank kno0ws their availability to pay back for the goods and services rendered to them without money.

Therefore credits are created when when banks accepts deposits from its clients or even from the governmental organizations.When those deposits are deposited,they usually lend loans to clients hence i n that process care creating credits .