Question

Story of gold Smith Lala on the process of deposit and loan condition by commercial banks.

Answer 1

The story of Goldsmith lala revolves on how a goldsmith accepted gold from people for the exchange of materials. He would give them paper receipts as acknowledgement which on later stage became a medium of exchange called money.

In commercial banks, deposits are accepted by the bank from the public are in turn distributed at a rate to them as a loan amount as and when needed.