Bank - do we need them?

 

What is a bank?

A bank is a financial institution that accepts deposits from the public and creates credit.  Lending activities can be performed either directly or indirectly through capital markets. Due to their importance in the financial stability of a country, banks are highly regulated in most countries. Most nations have institutionalized a system known as fractional reserve banking under which banks hold liquid assets equal to only a portion of their current liabilities. In addition to other regulations intended to ensure liquidity, banks are generally subject to minimum capital requirements based on an international set of capital standards, known as the Basel Accords.

Banking began with the first prototype banks of merchants of the ancient world, which made grain loans to farmers and traders who carried goods between cities and this system is known as barter system.This began around 2000 BC in Assyria and Babylonia.

During the Roman Empire, lenders based in temples made loans and added two important innovations: they accepted deposits and changed money.

Modern banking practices, including fractional reserve banking and the issue of banknotes, emerged in the 17th and 18th centuries.

Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers in the bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer payments via other payment methods such as Automated Clearing House (ACH), Wire transfers or telegraphic transfer, EFTPOS, and automated teller machines (ATMs).

Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to customers on current accounts, by making installment loans, and by investing in marketable debt securities and other forms of money lending.

Does cryptocurrency provide a better option for modern day banks and the banking system?

What is a financial intermediary?

What is Ripple Banking?

Investment Banks Cryptocurrenies

Commercial Banks Cryptocurrency

Central Banks Cryptocurrencies

 

Retail banking, also known as consumer banking, is the provision of services by a bank to the general public, rather than to companies, corporations or other banks, which are often described as wholesale banking. Banking services which are regarded as retail include provision of savings and transactional accounts, mortgages, personal loans, debit cards, and credit cards. Retail banking is also distinguished from investment banking or commercial banking. It may also refer to a division or department of a bank which deals with individual customers.


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