Fill in the blanks with suitable word (s):
i. A Bank accepts deposits from people and ________ money to those
who need it for various purposes.
ii. Banks act as ________ between people having surplus money and those
borrowing money.
iii. Banking facilitates business activities and is considered as an important
auxiliary to ___________.
iv. Banks facilitate payment through _________ instead of currency.
v. A ___________ advances money out of his own private wealth and
generally does not accept deposits from others.
Answers
Answer:
who saves money for future can deposit his savings in a bank. ... Fill in the blanks with suitable word (s): ... (b) Banks act as ______ between people having surplus money and those borrowing money.
Answer:
A bank mediates between those who have surplus money and those who need money by allowing both to open accounts with it. Banks only keep about 15% of cash reserves to provide to people who come to withdraw money on a daily basis. Those with surplus money are encouraged to invest with the bank and are paid a certain rate of interest for the same. Those who need loans are required to pay an interest on their loans. The difference between payment to lenders and receipt from borrowers comprises the bank’s earnings. Thus, the bank acts as a beneficiary for those with surplus money as well as those who need money.