The world’s economy is running behind the Businesses. You may be an employee or employer, but the reason behind the food on your table is business which may be run by you or your boss. So everyone in the world is part of any business. Where there is money, there must be any business as a source of that money.
So money is the return of any business based on the product or services sold value. You may mention that not only selling, buying also money is transacting between the parties. But if you buy any product or service, that is sales for your Vendor.
So Business is nothing but purchasing from vendors and selling the same product with additional profits. The value of profit or product and service value is calculated only on money. So product value is nothing but a certain amount of money.
We saw all businesses fix a money value for their products or services. But banking businesses have their products as real money. Actually they sell their money and get their returns and profits also the money. Yes. We all know about that. But where do they differ from the other business?
A business is nothing but the transportation of the product from the vendor to customer with a certain margin as profits. This is the basic definition of a business. This same definition is also applicable to the banking business also. Here their vendors are savings and fixed bank account holders who give money to sell to their actual customers.
If savings or fixed account holders are the vendors of the bank means, who are their real customers? Their actual customers of the banks are loan account holders. Actually they buy the money from vendors who are the savings and fixed account holders and they sell to the loan account holders.
As I already said, their product is money and they purchase their products as money at the rate of 2.5% interest for a year. Then they sale their product which is money to their loan account holded at a minimum rate of 10.25%. And they have trusted vendors also in the name of fixed deposit and recurring deposit holders also. They purchase money from them at the average rate of 5%.
This is the actual banking business that happens in the world. So they get a minimum profit of 5% each year. If they give a loan to a loan account holder using a savings account holder’s money, then they earn 7.75%(10.25-2.5) per year as their profit.
So here the savings, fixed, recurring or any other deposit account holders are the banker's vendors not the customers. And all of the loan account holders are the actual customers for them. In any business process they treat their customers at a higher standard level than the vendors. But in banking business only they will treat vendors more than the customers. Because here the product is nothing but money. So only the process is reversed.
This article is just to explain the banking process and how they treat money as products. Yes they have loss also if they did not receive the loans paybacks. Because every business has their own risks and returns. But treating the customers and vendors is different from other businesses due to the fact that the product is real money. As a savings account holder, every bank is your customer and as a loan account holder you are the real customer of that bank. But the purpose of any business is to give a reasonable value to society. It may be any business but please focus on the society's value rather than the money you make from the business. This is the ultimate aim of the business. This is also served by the banking business because any successful business in the world has the spinal cord which is the banking business. So any business you start, even the banking business, please focus on the society's values and respect the customers more than the profits made by your business. Because money is just a tool to achieve your ultimate vision which is giving a value to society.
