Advantages of interest or profit sharing

The most identical with banks are interest (conventional banks) and profit sharing (Islamic banks). This is the main source of income for each bank. Interest and profit sharing are income received by banks from those who borrow money from the bank. The bank itself, lending the money uses money collected from its customers.

So here the bank does not use the money, but uses the customer's money to provide loans to borrowers. And that's where banks benefit from interest or profit sharing.

Simple illustrations like this, you save in the bank for 10 million, your 10 million will be used by the bank to lend money to other people. Well, people who borrow money at the bank are obliged to return 10 million plus interest or bank profit sharing, say 12 million including interest / profit sharing. The bank will automatically get a profit of 2 million.

The question is, what if you want to take the 10 million money even though the money has been used by the bank to channel credit, and the borrower has not been completed in returning the 10 million? The answer is no problem because banks still have savings from other customers that can be used to bail if you want to take money. And if the savings from other customers are still lacking because many also want to take their funds, as far as I know the bank can look for bailouts from Bank Indonesia which may not run out of money because they have the frequency and control of money circulating in Indonesia.

Benefits of investment

Banks are indeed synonymous with sources of income from interest and profit sharing, but in reality banks often innovate to find other sources of income, one of which is investment. Just like the loan concept, banks in making investments also use their customers' funds, not bank funds. It's just that, banks cannot just use the funds owned by customers, but the customers themselves must voluntarily participate in investing.

In return, customers will also get a share of the investment returns. The form of investment that is often carried out by banks is in the form of mutual funds. Well, this mutual fund can be purchased by customers, without buying it, customers will not participate in bank investment.

But what you need to understand is that the name is investment, so there is no risk of failure, so when you buy a mutual fund there is no guarantee of money going back. Because of this reason the bank cannot use customer funds without voluntary customers, unlike loans that will definitely return.

Benefits of Safe Deposit Box (SDB) Services

One of the banking service products that is no less popular than other products is Safe Deposit Box, or often abbreviated as SDB. This is a very safe item storage service, just like you save money in a bank, storing goods in the bank is equally safe. To use this one bank service, customers will be charged a fee.

The services of this bank are quite in demand in the market, especially for companies in storing securities, or people with high economic ability to store assets and other important items.