BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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from the banker
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from the customer
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to the customer
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Either A and B
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Detailed explanation-1: -[1] When customer deposits money into his bank account, the bank becomes a debtor of the customer. [2] No new contract is created every time there is a new deposit as the account is continuing in nature. [3] The banker is not, in the general case, the custodian of money.
Detailed explanation-2: -Although banks do many things, their primary role is to take in funds-called deposits-from those with money, pool them, and lend them to those who need funds. Banks are intermediaries between depositors (who lend money to the bank) and borrowers (to whom the bank lends money).
Detailed explanation-3: -Deposits are like debt in that it is money that the banks owe to the customer but they differ from debt in that the addition or withdrawal of money is at the discretion of the depositor rather than dictated by contract.
Detailed explanation-4: -Bank debt is a long-term liability a business takes on by borrowing money from its bank. It appears under liabilities on the balance sheet as part of all the money the company owes its creditors.