Explain any three loan activities of banks in India
Money and Credit (10)Explain any three loan activities of banks in India.
Answer
Loan activities of Banks in India:
- Banks use the major portion of the deposits to extend loans.
- Banks charge a higher interest rate on loans than what it offers on deposits.
- Banks make use of the deposits to meet the loan requirements of the people.
- Banks mediate between those who have surplus funds (the depositors) and those who are in need of these funds (the borrowers).
Exam Year:
2017
Related Questions
- Why is modern currency accepted as a medium of exchange without any use of its own
- Which one provides assured payment
- Justify the role of Self Help Groups in the rural economy
- What is meant by double coincidence of wants
- Why is cheap and affordable credit important for the country's development
- Why is it necessary to increase a large number of banks mainly in rural areas