The gap between the interest rates charged to borrowers and the interest rates paid to depositors is the main source of income for banks.
For most commercial banks, interest income is their main source of income. It is accomplished by taking money from depositors who don't need it right away. Depositors receive a certain interest rate and financial security in return for their deposits. The bank can now lend the deposited money to clients who require quick cash. Lenders are required to pay depositors a higher interest rate on the money they borrow. Due to the difference in interest rates between the interest it pays and the interest it receives, the bank makes a profit on its investment.
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