A bank plays an important role for the economy of any country. A nation’s economic stability is directly related to the strength of its banking sector. It’s true that banks aren’t wealth creator, it only carries out the business of lending and borrowing, but this lending borrowing is what gives rise to credit creation in the economy. A bank gives birth to the entire process of production, exchange and distribution. This way a bank plays a dominant role in the formation of a stable economy. Banks mobilise the saving of individuals by investing them in the form of borrowings to the different people, entrepreneurs or even non-governmental associations…
What if banks are not there?
In the absence of banks, a major part of the nation’s saving would be kept idle which would lead to huge losses to the owner as well as to the nation’s economy as well. Then entire banking system is like the circulatory system of the nation. The capital which is invested is like the blood which keeps the heart thumping if the blood runs in the circulatory system, and the heart keeps thumping successfully, the whole body (the nation) remains healthy. In absence of blood to any part of the body, that particular organ would cease to function and become a burden! So, blood (capital) should flow towards every organ (sector) of the body (nation). The main organs of the nations are the agricultural sector, the service sector and the secondary sector!. The loans that the banks lend to anyone in need functions as the investment to start up any kind of business. San Francisco Bank offers the best services. Cheques form an integral part of the various instruments provided by banks for credit creation.
Milton Ferrara is a professional blogger and writer with an experience of half a decade. Known for his amazing take on conventional matters and his boldness for writing new fresh content, he has a strong presence on the web.
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