How do banks generate income?

[Aanuoluwatofunmi]

Bank have no other financial way of generating their income than the charges they deduct from our individual accounts and how they engage our money in doing other businesses that fetch them more money than we ever imagine, if we ever have an idea of how they generate from us through the deposit we make with them on our account ad yet still make indiscriminate deductions,  that same day we will stop using them and withdraw our entire money.

[gunhell16]

If a bank doesn't have clients to funnel money into them, there's no reason for them to make a profit. Therefore, the income of banks is based on the deposit of money by their customers who will trust to hold money that is not theirs.

In addition to that, when their clients start depositing money in their bank, there will be an opportunity to start generating income for the bank, by depositing money in the stock market, real estate, lending, and so on.

[carlisle1]

Bank have no other financial way of generating their income than the charges they deduct from our individual accounts and how they engage our money in doing other businesses that fetch them more money than we ever imagine, if we ever have an idea of how they generate from us through the deposit we make with them on our account ad yet still make indiscriminate deductions,  that same day we will stop using them and withdraw our entire money.

If you fully understand the setup and you have a good trust in yourself in keeping your money, maybe you won't hesitate to
do it by yourself and let you hold and save it in your own vault.

But, most of the people are not that secured by their own ways as they needed the help of the banks to store their money, you are right
there are cycles that banks are doing with the depositors' money and they are good at doing it, especially in finding resources to invest.

It's the system and how the bankers playing on it that makes them more money from the depositors' assets.

[Freddie Boyer]

Financial institutions (banks) are responsible in handling financial issues, records, accounts and income of individuals, companies, churches and organizations. They respond promptly according to your demands on your accounts, they also have zero tolerance for fraud and are very security conscious, security intelligence and anti financial crime expertise but they've policies of not collecting dime from customers accounts yet banks are most wealthiest institutions on earth.

How do they make money?

* Transfer charges

This is what makes financial institutions very wealthy.

Yes. Not only in crypto there are taker and maker fees, Gold purchases also have a fee for making. So wherever we go all costs arise especially at the Bank when transferring funds to a different bank. It's all charged to customers or users. If indeed there is no cash balance, it will be debited directly to the customer's account, but of course with approval and done in front of the customer. maybe this is what makes the customer a little safe because there is confirmation from the bank. Conclusion everything has a cost associated and attached and nothing is free.

[Rupok]

Banks have many systems of income, banks usually adopt different ways of providing loans.  They give loans to people in various ways but in return they charge a fixed interest.  Mainly the income of the bank is through the customer. Banks give different percentages of interest by maintaining different policies to the customers.Like high interest for business loans and very low interest for agricultural loans.  But for agriculture loan will not give you much credit.  Also, if someone deposits money in the bank for a period of five years, then in that case he is given 5% interest, but they lend that money to customers at 10% interest.  They are making profit by lending customers money to customers.Although banks have good security systems but still no system can guarantee 100% security.

[Bitcoin2009]

Banks collect money from customers and give interest to customers with a small amount, in my place the highest official bank interest is only 8% per year, but banks receive interest from borrowers around 24% per year so it has a very large difference.

[nesty]

Banks generate income in different ways. One of the sources of income of banks are the interest they earned in their products and services. When bank lends money to borrower, they charge interest on the amount they borrowed that will become the banks earnings. Usually the interest rate is higher than the interest paid to depositors. Another source of income for banks is through fees that are being charged to various services like in ATM the withdrawal fees and balance fees, they also charge transfer fees in overseas wire transfers. Banks also generate income from foreign exchange trading etc.

[Halime Anatolia]

there are so many ways. the mains are interest on loans, interest on deposits, fees and service charges, credit cards and payment services. believe me they earn too much.

Why they can, it's because they (banks) are protected by regulations from the regional government or the state which is considered capable of managing it properly and correctly. As for the bank's additional income, I think they also show the rules of the game, for example, if you apply for a bank loan, they also show the borrower a table of calculations. If you agree, sign and pay the installments.

If regulation of this digital currency also gets the same treatment, I don't think it will be much different, and will be an attractive option in the future. Take a look at how the US government is working today to Binace, which made the market red a while ago.

[yohananaomi]

Banks collect money from customers and give interest to customers with a small amount, in my place the highest official bank interest is only 8% per year, but banks receive interest from borrowers around 24% per year so it has a very large difference.

you are right, the bank can carry out regular activities well because of the income from customers who keep their money there. It is clear that each customer's money will be moved so that the bank is able to receive benefits from the movement of the customer's money, the biggest of which is to provide loans to creditors with interest rates greater than the interest given to customers. the difference generates profit, which is used by the bank to be able to drive the activities of the bank. Of course, not only from customer money, banks get funds to carry out activities, it can also be from bank owners and investors as well as loans from large banks with lower interest, of course.

[Vishnu.Reang]

If a bank doesn't have clients to funnel money into them, there's no reason for them to make a profit. Therefore, the income of banks is based on the deposit of money by their customers who will trust to hold money that is not theirs.

In addition to that, when their clients start depositing money in their bank, there will be an opportunity to start generating income for the bank, by depositing money in the stock market, real estate, lending, and so on.

Yes, I agree with you, income of banks is based on the deposit of money by their customers apart from this the profit from such a sales loan is much higher than the collection of ordinary interest for using a loan. A secondary loan participation or loan sale is a contract which sales the cash stream from an underlying bank loan to a third party. There are more earning source for banks such like from penalty, this kind of fee use to collect from people who are not able to pay their loan at time and when a specific term of the loan contract is violated.

[Obari]

Bank is an establishment known for financial services but what they do these days is way more than that. And the things they do are both legal and illegal, still, they cover up under the guise of the legality that covers the sector.

Mind you, you forgot to add that;

1. They launder money.
2. They broker onshore and offshore deals (both legally and illegally).
3. They steal money from customers' accounts through double and unexplainable charges.
4. They blackmail their customers and steal the money of the faint in heart.
    And many more...

There is a lot that will always make me sceptical of banks.

Adding to all you've mentioned so far, banks also claim monies of their deceased customers  and this is the very one that is always very bad as rather than seeking to know what happened to their customers who suddenly  left some reasonable  sum of money in their care without checking,  they suddenly  assume the person is dead or even trace to know the person is dead and when no family member traces the money, it automatically becomes property of the bank and I'm saying this based on a recent happening  in my locality.

Op you already listed all the ways banks make money but I just want to say in my friends voice that illegal money is the money that will give you all you desire and banks also indulge in illegal acts

[swogerino]

In Europe banks have come up with a charge from 1-3% depending on the country you are on money on arrival.For example if you exchange crypto through some exchange online and receive money in your account,let's say 1000 dollars the bank get from 10-30 dollars in just one single such transaction.This was not before and this means that the banks are always looking for more ways to "steal" people from money that they belong to them,just like in this case when you got money in arrival.All other mentioned ways of course are well known,just wanted to add this new invention of Europe banks from about 7-8 months now.

[xSkylarx]

In Europe banks have come up with a charge from 1-3% depending on the country you are on money on arrival.For example if you exchange crypto through some exchange online and receive money in your account,let's say 1000 dollars the bank get from 10-30 dollars in just one single such transaction.This was not before and this means that the banks are always looking for more ways to "steal" people from money that they belong to them,just like in this case when you got money in arrival.All other mentioned ways of course are well known,just wanted to add this new invention of Europe banks from about 7-8 months now.

That's huge. I mean, you are paying them a fee for just a transaction like sending or receiving, and all banks in Europe are doing this? This is very hard for the customers as they are forced to pay that fee, and I would say it is some kind of theft. We are just lucky that this is not the same in our country if you transact within your bank, but if your bank is different and you transact to another bank, that is where the fees start, which are also huge but not the same in your country.

[carlisle1]

Bank is an establishment known for financial services but what they do these days is way more than that. And the things they do are both legal and illegal, still, they cover up under the guise of the legality that covers the sector.

Mind you, you forgot to add that;

1. They launder money.
2. They broker onshore and offshore deals (both legally and illegally).
3. They steal money from customers' accounts through double and unexplainable charges.
4. They blackmail their customers and steal the money of the faint in heart.
    And many more...

There is a lot that will always make me sceptical of banks.

Adding to all you've mentioned so far, banks also claim monies of their deceased customers  and this is the very one that is always very bad as rather than seeking to know what happened to their customers who suddenly  left some reasonable  sum of money in their care without checking,  they suddenly  assume the person is dead or even trace to know the person is dead and when no family member traces the money, it automatically becomes property of the bank and I'm saying this based on a recent happening  in my locality.

Op you already listed all the ways banks make money but I just want to say in my friends voice that illegal money is the money that will give you all you desire and banks also indulge in illegal acts

True, that's reality that happens with bank users who died. If there's no claimant of the money,
eventually the money will somehow go to the possession of the banks.

Or, even it's in the maintaining balance, the money will continue to be used as part of bank investment,
they will use the money to make more money.

One of the way where banks have an upper edge to accumulate more money with the money of users who
are not using their money and just leave it as savings for longer time frame.

[Smack That Ace]

In Europe banks have come up with a charge from 1-3% depending on the country you are on money on arrival.For example if you exchange crypto through some exchange online and receive money in your account,let's say 1000 dollars the bank get from 10-30 dollars in just one single such transaction.This was not before and this means that the banks are always looking for more ways to "steal" people from money that they belong to them,just like in this case when you got money in arrival.All other mentioned ways of course are well known,just wanted to add this new invention of Europe banks from about 7-8 months now.

That's huge. I mean, you are paying them a fee for just a transaction like sending or receiving, and all banks in Europe are doing this? This is very hard for the customers as they are forced to pay that fee, and I would say it is some kind of theft. We are just lucky that this is not the same in our country if you transact within your bank, but if your bank is different and you transact to another bank, that is where the fees start, which are also huge but not the same in your country.

It's a crazy charge and the first time I've heard of it. Honestly, I don't believe in that charge. If I remember correctly, the transaction fees of banks in my country range from 0.1% to 0.3% or less, and that's a hefty fee for many people. I don't believe that is happening in developed countries like Europe, and their people will accept those huge transaction fees. Even e-wallets don't charge such high fees, how can banks do that? I really doubt these.

[Litzki1990]

Bank have no other financial way of generating their income than the charges they deduct from our individual accounts and how they engage our money in doing other businesses that fetch them more money than we ever imagine, if we ever have an idea of how they generate from us through the deposit we make with them on our account ad yet still make indiscriminate deductions,  that same day we will stop using them and withdraw our entire money.

If you keep money in the bank, a certain amount of money will be charged every year based on your money, and if you are given an ATM card, the bank will charge you a certain amount after a certain period of time for the ATM card. 

A portion of the money deducted by the bank for keeping money in the bank and for the ATM card has to be paid to the government as VAT. And if you put money in the bank, the bank doesn't keep that money for a while, they invest that money and give loans to different customers, and as a result of giving loans to customers, they take some amount of interest from the customer, this is a part of the bank's profit.  If you keep money in the bank, not only will the bank deduct the charges from you, you will be given some amount based on the profit of the bank, based on your money, which you can take as interest on keeping money in the bank.

[Texac]

Bank have no other financial way of generating their income than the charges they deduct from our individual accounts and how they engage our money in doing other businesses that fetch them more money than we ever imagine, if we ever have an idea of how they generate from us through the deposit we make with them on our account ad yet still make indiscriminate deductions,  that same day we will stop using them and withdraw our entire money.

Banking is also another form of business to make a profit, if you don't like the way they treat you, you can stop using their services, I'm sure they don't need you.  i don't find it funny that we constantly criticize banks because they are just business people looking for profit to make a living. if you are not satisfied with them, you can simply stop using their service, but if you still use the bank, badmouthing them won't make you any better than them.  I'm not defending the bank, but no one is forcing us to use the bank if we don't want to.

[Spaceman1000$]

Bank's make their money from different sources, they are most times involved in stock market trading, Forex trading with the helps of expert traders that can predict the market, they all make their money from loan facilities they gave out to customers.
 
The Banks are always happy when a customer makes heavy deposit, because they use that deposited money and invest in business that will give them huge returns in a short period of time, don't forget that, customers pay for account maintenance, this money runs into millions by the time you multiply it with the number of customers they have.
All of this helps them to maintain operational cost, like paying if salaries, utility bills and a whole lot more.

[Hamphser]

In Europe banks have come up with a charge from 1-3% depending on the country you are on money on arrival.For example if you exchange crypto through some exchange online and receive money in your account,let's say 1000 dollars the bank get from 10-30 dollars in just one single such transaction.This was not before and this means that the banks are always looking for more ways to "steal" people from money that they belong to them,just like in this case when you got money in arrival.All other mentioned ways of course are well known,just wanted to add this new invention of Europe banks from about 7-8 months now.

That's huge. I mean, you are paying them a fee for just a transaction like sending or receiving, and all banks in Europe are doing this? This is very hard for the customers as they are forced to pay that fee, and I would say it is some kind of theft. We are just lucky that this is not the same in our country if you transact within your bank, but if your bank is different and you transact to another bank, that is where the fees start, which are also huge but not the same in your country.

It's a crazy charge and the first time I've heard of it. Honestly, I don't believe in that charge. If I remember correctly, the transaction fees of banks in my country range from 0.1% to 0.3% or less, and that's a hefty fee for many people. I don't believe that is happening in developed countries like Europe, and their people will accept those huge transaction fees. Even e-wallets don't charge such high fees, how can banks do that? I really doubt these.

Also my first time on hearing out on having those deductions on the time that you would really be making out transfers on your account which is really that totally different on what most countries do have when it comes
to this manner because once you do transfer out then its would be completely a whole amount and not being deducted because this is really indeed that stealing. What are those deductions for?
I would definitely be not storing or making some transfers into my account if this one would be the case. 1-3% is horribly not that unacceptable.

Banks do generate income on giving out loans into people which they do charge up 1-2% per month interest while those deposits or investors who had been storing up money on the bank
are just given 1-3% annually on which we could really make out some serious income or money on this kind of way. Losses are there but in the end of the year they are really
generating that huge profits out of this concept or system which its not shocking.

[Wimex]

Bank is an establishment known for financial services but what they do these days is way more than that. And the things they do are both legal and illegal, still, they cover up under the guise of the legality that covers the sector.

Mind you, you forgot to add that;

1. They launder money.
2. They broker onshore and offshore deals (both legally and illegally).
3. They steal money from customers' accounts through double and unexplainable charges.
4. They blackmail their customers and steal the money of the faint in heart.
    And many more...

There is a lot that will always make me sceptical of banks.

3. They steal money from customers' accounts through double and unexplainable charges.

I don't know how many times that has happened to me, and the worst thing is that it is claimed and they turn a blind eye as if it were a platform problem, this happens a lot since it was decided to carry out transactions virtually now they can make their excuses for steal no problem. The truth is that many do not trust the banks, i have had very bad experiences, and less in the loans that they make, since in addition to the fact that the interests, are exuberant and increase every month, they use loans with collateral as a requirement, which in my opinion could bring anyone to ruin, that's why I prefer to take care of myself with them, i only use it for necessary things, because as an option to  save my money never... imagine it going bankrupt (goodbye to my efforts)... I prefer to invest it and save the earnings in virtual wallets I feel more secure with these.