2007-11-05 14:14:56 · 6 answers · asked by David Twaine 1 in Business & Finance ➔ Personal Finance
They take deposits from folks like you, pay you a pittance in interest and then loan your money out at much higher rates.
2007-11-05 16:29:31 · answer #1 · answered by The Professor 5 · 0⤊ 1⤋
Several ways. Loaning out money for less than they get it for. Fees for accounts, safe deposit boxes, mortgages, overdraft, bank card interest and fees.
Our bank charges our company $5,000 a year to keep a line of credit and we need it for our insurance company but never use it so it is all profit for them.
Money kept in low interest checking or savings sometimes a fraction of a percent is loaned out as home improvement or car loans or business loans sometimes personal loans.
2007-11-05 22:19:08 · answer #2 · answered by shipwreck 7 · 1⤊ 2⤋
they use our money to invest in mutual funds and other stocks and annuities. Our cash is put in banks to gain interest in there accounts and the use of their bank allows them to use our money to invest on their own.They in turn pay us an annual interest rate. Look into mutual funds or annuties to invest for yourself
2007-11-05 22:27:33 · answer #3 · answered by Steven V 3 · 0⤊ 2⤋
1. They charge service charges for all kinds of things.
2. They borrow money at low rates and loan it out at high rates.
2007-11-05 22:22:37 · answer #4 · answered by hottotrot1_usa 7 · 0⤊ 2⤋
finance charges, monthly fees, interest rates, over draft fees, penaltys... ... ...
2007-11-05 22:29:48 · answer #5 · answered by L T 1 · 0⤊ 1⤋
they invest your money in stocks for one
2007-11-05 22:23:07 · answer #6 · answered by john doe 5 · 0⤊ 2⤋