Banks are essential institutions in the financial world but have you ever wondered how they make money at first glance it may seem like banks simply hold onto your savings and give you a loan but the truth is much more complex banks make money by leveraging the funds they receive from depositors and borrowers in various ways one of the main ways banks earn revenue is through the interest rate spread this means that banks lend money to borrowers at a higher interest rate than what they pay on deposits.  If you deposit money in a savings account the…