Question

Commercial banks, mutual savings banks, and credit unions borrow money from their customers and lend that money to other customers.

a. True

b. False

Answer 1

Statement is false.

Commercial banks accept deposits from Customers and lend money to other customers. These are incorporated for generating profits to its shareholders.

Mutual saving banks formed by Central or state governments owned by its members and will not have shareholders like commercial banks. They have been formed to cater the requirements smaller income or lower group of people.

Credit unions are controlled by its members and profits are shared among members itself.