Why Do We Use Banks?

What is a bank and why do we use them?  This is a very good question and one that may surprise you.  For many, a bank like Columbia Bank East Brunswick is very important to the community.  Banks allow us to store and manage our money in a way that will allow our society to function.

Columbia Bank
389 NJ-18, East Brunswick
NJ 08816, United States
Phone: +1 732-432-7171

To begin with, banks are insured by the government.  This means that the government supplies banks with money which it then distributes to the population.  The population will then use this money as a form of unified barter to get goods and services that they need in order to survive. 

If we didn’t have banks and their services, then we wouldn’t have a standardized way of getting goods and services.  For example, if you wanted a house someone could say that they wanted five hundred chickens for this house.  Now, if you didn’t have chickens you just had pigs, then you couldn’t purchase the house.  With banks and money, we now have a way to set fair prices for items and manage it much easier.

To grow the community

Another reason that we need banks is to help grow the community.  There are going to be people known as investors who will go to banks and ask for money in order to do a large project such as build a school or housing.  If the banks agree then the money can be given to a business who then goes out there and manages the project, paying smaller companies a portion of this money to do specific tasks.  Then when these tasks are done the project is completed and can be used by the public. 

Once the project is used by the public the company starts to collect money in the form of fees, rent or whatever other means it sees fit.  This money is then deposited back into the banks where it grows allowing more money to be used and given away which in turn helps grow the community.