Explore Investment Management articles and practical insights for finance professionals
A bank note is a note issued by a bank representing its promise to pay a specific sum to the bearer on demand and acceptable as money. It is often known as a bill, paper money or simply a note.
The banking system as a whole can create an amount of money that is a multiple of deposits. The bank lending leads to new deposits in the banking system and a multiplier effect on the money supply. In a check-able deposits only system (no cash), the money supply equals bank reserves divided by the reserve ratio.
