BANKING AFFAIRS

Detailed explanation-1: -Interest on a savings account is the amount of money a bank or financial institution pays a depositor for holding their money with the bank. In a way, a bank borrows money from their depositors by using the deposited funds to lend money to other customers.

Detailed explanation-2: -Banks use the money deposited on savings accounts to lend to borrowers, who pay interest on their loans. After paying for various costs, the banks pay money on savings deposits to attract new savers and keep the ones they have.

Detailed explanation-3: -It depends on your account. With most savings accounts and money market accounts, you’ll earn interest every day, but interest is typically paid to the account monthly.

Detailed explanation-4: -But who’s going to pay you to borrow your money? For many people, opening a savings account is one of the easiest ways to go about this. When you put money in a savings account, the bank is technically borrowing the money and paying you interest in return.