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Write a 14 pages paper on banking versus banks. It means a bank is a financial institution that holds payments of the customers and gives back to them whenever they demand it.Banks run the economy by
Write a 14 pages paper on banking versus banks. It means a bank is a financial institution that holds payments of the customers and gives back to them whenever they demand it.
Banks run the economy by payment system this thing makes the banks special. They only create money in the form of claims on their own debts. Their specialness lies in their abilities to economize on the use of outside money with their on deposit liabilities. Banks are special in so far as they only can lend claims on their own debt which are accepted and used by the public as money. This power grants banks a unique role in the economy. As money creators, they are irreplaceable by no- bank intermediaries. Banking needs more technology.2
Four components are used in the development of banking. Each component has its own importance no one of them can be neglected. Banks simply try to implement these steps but still there is big competition between banks. These steps of banking are interrelated to each other. We will discuss these steps or components in detail. We will check the implementation of these steps using banks and other intermediaries.
The first element of banking is credit. Banks have always been suppliers of credit to worthy borrowers with the capacity to undertake and finance productive investments. The business of providing credit is made up of origination, funding and servicing. Each element of banking requires different sets of skills and qualifications. A large bank such as Westpac can add real value to the origination and servicing portions of the credit business, but not as much to funding all credit business.
The origination side of the credit business firstly involves finding the customer. Getting a customer on the books requires selling skills, be the target of an existing or a new customer. Over the last decade, banks have developed these selling skills.
