ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The primary source of income for banks is the difference between the interest charged from the borrowers and the interest paid to the depositors. Banks usually collect higher interest from loans than the interest they provide for deposits.

Detailed explanation-2: -Banks charge a higher interest rate on loans than what they offer on deposits. The difference between what is charged from borrowers and what is paid to depositors is their main source of income.

Detailed explanation-3: -The interest and dividend received from time to time on these investments is a source of income for the banks.

Detailed explanation-4: -The difference between the interest paid by the bank to its depositors and interest paid by the borrowers to the bank is the income of the bank.

Detailed explanation-5: -The difference between the amount charged from borrowers and the amount paid to depositors is the primary source of income for banks. This amount is known as interest.