Fractional reserve banking allows them to loan out more than they actually have.
They charge a huge amount of interest on the loan. As long as enough people make good on their loans rather than go bankrupt, the bank makes money.
Fractional reserve banking allows them to loan out more than they actually have.
They charge a huge amount of interest on the loan. As long as enough people make good on their loans rather than go bankrupt, the bank makes money.
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