Jugglingart.Org

Some of you may have read Donald Duck comics. Donald Duck has a very rich uncle named Uncle Scrooge. Uncle Scrooge is an extraordinarily rich so that he could build a huge warehouse that can be used to store all the piles of money, both currency notes and coins.

So much money he has, so Uncle Scrooge is portrayed as a greedy person.

This article certainly is not going to discuss about Uncle Scrooge and piles of money. But when we talk about the bank, it could be said that much money may also be owned by the bank where you save money. Even so you do not have to worry about piling all his money in the bank like Uncle Scrooge.

Most of the money in the bank is the customer's money. If banks keep all clients' money in one place, meaning the money is not productive. In fact, banks also need to find revenue in order to pay interest on savings and deposits that you store on them. That is why, the bank then "throw" the most money back into the community in the form of loans (credit).

For example, if you save money USD 10 million in deposits, the bank promised to provide an interest rate, for example, 13 percent per year. By banks, in fact money USD 10 million will be "thrown" back into society by way of loan to those who need (such as people who want to open a business or want to buy an item). Loan repayment terms are accompanied by interest rate greater than 13%, say 18 percent.

So the bank will earn income of USD 1.8 million (18 percent from USD 10 million), and of that number, amounting to USD 1.3 million of his will be used to pay interest on your deposit amount 13 percent. The difference of USD 500,000 will be the bank's profits. Of course, the advantage was still to be reduced again by a bank operating costs such as salaries of employees and others.

Can you imagine how many funds can be lent by the bank when there are thousands of people save money in the bank? In fact, the bank certainly does not throw 100 percent of their clients money in the form of credit. This is because every day there are people who pulled their money in bank deposits. Well, if 100 percent of clients' money thrown in the form of credit, so if there are customers who want to withdraw their money, then it would be trouble. That is why, the bank must have a supply of cash to keep it available money for customers who want to withdraw his money.

Supplies the cash by the bank will be deployed to all branches and also to the ATM machines. Of course the numbers are limited. That's why cash withdrawals at ATMs are often limited. If you want to withdraw money in an amount greater than that, you have to come directly to the the bank.

Withdrawal at the bank counter usually not limited in number (as long as your balance is sufficient). However, due to cash-owned banks usually "limited", then you usually have to give out first (usually the day before) if you want to pull in huge quantities. This is so that banks can provide the cash first. It is some kind of monetary policy.