How do banks make money?


Answer: Traditionally, banks accept deposits and loan that money to borrowers providing a time arbitrage on the velocity of money which regulates in profit. In more recent years, banks have diversified their profit centers by investing those deposits in fixed income securities. There has even been a proliferation of into multiple types of banks. Some of these banks include investment banks which transact in the capital markets pairing investors with capital seeking counterparties. The most innovative banks are starting to see how data can become a profit center as well as allow them to provide a better customer experience.