The receipt is your proof that you deposited money into your account. Once a month, many financial institutions send customers a letter or statement summarizing all transactions that have occurred during that month. The statement will list the account balance and show how much interest your money earned. It's a good idea to check your statements to make sure there are no errors. Financial institutions need to have money, or capital, available in order to make loans.
Financial institutions earn a profit by paying depositors less than they charge borrowers.
So, a financial institution may pay depositors 3 for every dollar on deposit, but charge borrowers 7 for every dollar borrowed. The financial institution keeps the 4 difference. When a financial institution lends money, the transaction is referred to as a loan. Loans are serious obligations. Remember, financial institutions use depositors' money to make loans.