Chapter - 8 Banks and the Magic of Finance
Chapter - 8 Banks and the Magic of Finance After learning about physical infrastructure (like roads and railways), we now understand that money also needs a system to move and be managed. This system is called financial infrastructure. What is Financial Infrastructure :- Financial infrastructure is a network of institutions and systems that helps people and organizations handle money and carry out transactions. Main Components: Banks – keep money safe, give loans, and allow deposits Payment systems – enable digital payments (UPI, cards, online transfers) Stock markets – help companies raise money and people invest Financial institutions – support savings, insurance, and investments Why is it important? Helps people send and receive money easily Supports business activities and trade Provides funds for building and maintaining infrastructure Ensures smooth flow of money in the economy What are Banks and What Do They Do:- Banks are financial institutions that help peopl...