Podcast
Questions and Answers
What is the main difference between savings and loan associations and credit unions?
What is the main difference between savings and loan associations and credit unions?
Savings and loan associations traditionally loaned money to people buying homes, while credit unions work on a not-for-profit basis and are open only to members of the group that sponsors them.
Why are commercial banks considered the most important part of the financial system?
Why are commercial banks considered the most important part of the financial system?
Because of their large areas of influence and the fact that most people have their checking and savings accounts in commercial banks.
What do financial institutions do with the money they receive from deposits?
What do financial institutions do with the money they receive from deposits?
They lend it to other people or businesses that need funds to make a profit from the interest or fees they charge for those loans.
