What is lending
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What is lending
Lending is a daily loan. It is also called disassembly and loan dismantling.
Details of lending
Lending is usually limited to 1~2 days, usually 1~2 weeks, or a period agreed in advance. The borrower can repay at any time, and the lender can also notify the borrower to repay at any time, but generally not more than one month.
The interest of lending is calculated on a daily basis, which is called lending interest. The interest rate varies from day to day, even within a day. The level of interest rate sensitively reflects the supply and demand of capital market. (Shareholders College: http://www.58188.net )
There are two situations of lending: one is mutual lending between commercial banks;
The other is commercial bank lending to securities market brokers (notice lending).
The most important thing for commercial banks to lend is to buy and sell their excess reserve deposit balance in the central bank. After the end of a day's business, financial institutions may form surplus or shortage of funds. The insufficient ones cannot guarantee the normal operation of the next day. The surplus ones have idle funds. Therefore, it is necessary to temporarily adjust funds, that is, lend. In the way of borrowing funds, the bank that borrows funds generally issues a promissory note to the bank that borrows funds, and the bank that borrows funds issues a check (or notifies by telephone or telegram) to the bank that borrows funds, so that its excess reserves can be used. At the time of return, transfer from the lender's account to the lender's account. Because interbank borrowing funds are flexible and timely, it can reduce the total amount of reserves and improve the efficiency of fund use.
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