Banks serve another important role

Banks serve another important role - Banks serve another...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Banks serve another important role. When you look at a check or a debit card you will usually see the name of a bank. Individual banks serve as the issuing and regulating bodies for many financial services often employed by consumers. In this way, banks are able to give depositors access to their money while also maintaining a large number of loans. What happens when you deposit money into a bank? First, the money is recorded (usually by computer) and added to your account. It is then placed into the vault. At various times during the day, money is removed from the vault and taken to a second bank. This bank, unlike the first, does not serve individuals. It is a "banks' bank," usually a branch of the Federal Reserve. The first bank is able to make deposits, withdrawals, and take out loans from the second bank. When you walk into a bank to withdraw money or to take out a loan, the reverse of the...
View Full Document

Ask a homework question - tutors are online