After the end of the crisis in August 1998, the Russian economy became in dire need of funding sources. Due to the presence of external and internal debts, due to the general distrust of Western investors and the collapse of the state securities market, the authorities again turned to a trusted source - the savings of the population.
Savings are funds that are saved by the population for the future. They are formed due to the difference between income and current expenses, that is, the totality of funds that remained in demand when calculating for a certain period.
Bank funds
Most of the banks' job is to attract money from the population. So, the main indicator of the bank's work is the deposit portfolio. That is, the amount of free funds in circulation is associated with the ability to carry out active operations and receive income. To attract funds, banks use various conditions of deposits.
Depending on the conditions under which the bank attracts funds from the population, deposits have different terms and percentages:
- On demand - the depositor's money is returned on demand. Since there is no specific term, the rate on such a deposit will not be large.
- Term deposit - there is a certain period (1, 3, 6 months, 1 year). To receive all interest, the contribution should not be withdrawn at all times. Or the money will be returned with a low interest rate.
- Savings - it is forbidden to replenish and withdraw money in parts.
- Accumulative - replenishment of the invested amount is allowed.
- Settlement (universal) - the depositor can control his funds (incoming and outgoing transactions).
–Winning - interest is not accrued, but is played out between clients of this type of deposit, etc.
Why does the bank need deposits?
For loans - The Central Bank of Russia takes loans from foreign banks, leaving its assets as collateral. Then he gives loans to local banks, but with a high interest rate. And these banks, increasing the interest rate, give loans to the population for housing, business development, and various loans. Turnover - banks buy foreign currency at a lower price, then sell at a higher price. Securities, shares - money received from investors, later can be used to buy securities, shares. That is, the bank carries out brokerage activities.
The banking system not only provides profit to its shareholders, but also participates in the development of business, science, and also spurs technological progress. How? It's simple: the bank concentrates funds in itself, and then distributes them competently - invests in effective projects, supports enterprises, helps consumers solve their financial problems. Thus, the savings of the population are the main source of money with which banks, in particular, work, and thanks to which the economy as a whole exists.
