How Does a Bank Make Money | How Do Banks Earn Money | Full Information

Many times a question arises in our mind that how does a bank make money. And you have also come here to find the answer to the same question that how does the bank earn money. So today I will tell you in very simple language how do banks earn money.

how does a bank make money:-  Friends, banks earn money in many ways and you may not know that banks earn most of their money from their customers and you know that we are the customers of banks.

How Does a Bank Make Money

how do banks earn money


Credit and Debit Card Charges:- Friends, if you have a bank account in any bank, then you must be aware that the bank charges you many types of charges which are levied on your debit and credit cards. Banks charge different types of charges on your cards which can be cards renewal fee, service fee, card protection fee, every time the card is used, transaction fee and other types of charges banks take from you through your cards.

Now you will say how much the banks would have earned from these small charges, then I will tell you that the customers of the banks are not only you, there are lakhs or crores of customers just like you. If the banks charge even some money from each of the customers, then the earnings of the banks will be in crores.

How Do Banks Make Money

Loans and their charges:- Banks earn money by giving various types of loans to their customers. For example, personal loans, business loans, home loans and other types of loans are given to their customers by giving them money.

Now you will think that if banks are giving loans, then how will they earn money, then I can give you the answer. Banks levy full interest on the loans given to you and earn money from that interest and also when you do not pay any loan EMI, they earn money from you by levying more charges on you.


Investments :- When you deposit money in banks, banks invest your money in different places and earn good return on the money invested. Also, banks buy shares of a very big company and invest money in it, and when the share price increases, the bank's money increases and in this way the bank earns profit by investing your money.


Partnerships with shopping websites:-  Many times you see that whenever there is a sale on a shopping website, then we get some extra commissions on payment by the selected payment method, but for this there is a partnership between banks and shopping websites, so that the sales of the websites Increases and we use our banks' cards more and banks earn money from us by putting some charges on the cards.

Similarly, banks earn money from your money in many ways, but let me tell you a funny thing, if all the customers in the bank will go to the banks together to get their money, then the bank will never give their money to all the customers. Will be able to give Banks give you only the money deposited by you.

Along with this, banks earn money through you in even more small ways. We hope that you will be satisfied with the information given by us and you must have understood how the bank earns money.


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