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Month: August 2017

Reserve banking

Definition of fractional reserve banking

What is fractional reserve banking? Fractional reserve banking is a system in which only a fraction of bank deposits are backed by cash on hand and available for withdrawal. This is done to theoretically develop the economy by freeing up capital for loans. Key points to remember Banks are required to keep on hand a […]

Posted on August 20, 2017August 22, 2021 Author Patrick M. Salcedo Comment(0)

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