UNDERSTANDING OF THE BANK

In daily conversation, the Bank is known as a financial institution whose main activity is to accept savings and time deposits. Then the bank is also known as a place to borrow money (credit) for people who need it, besides that the bank is also known as a place to exchange money, move money or accept all forms of payments and deposits such as payments for electricity, telephone, water, taxes, tuition and other payments.

From the above understanding it can be explained more broadly that banks are companies engaged in the financial sector, meaning that banking activities are always related to the financial sector, so talking about banks is inseparable from financial problems.
The first banking activity is to collect funds from the wider community known as the banking world is funding activities. Definition of collection, funding means

is collecting or seeking funds by buying from the wider community.
So that people want to save money in the bank, the bank provides stimuli in the form of remuneration that will be provided to depositors. The fee can be in the form of interest, profit sharing, gifts, services or other services. After obtaining funds in the form of deposits from the public, the banks will repurchase the funds or resell them to the public in the form of loans or better known as lending.
The main advantage of the banking business based on conventional principles is the difference between the interest on deposits given to depositors with interest on loans or loans channeled. For banks which based on sharia principles do not know the term interest in providing services to depositors or borrowers Sharia principles applied by Islamic banks are financing based on profit sharing principle (mudharabah), financing based on the principle of equity participation (musharakah) principle of buying and selling goods by obtaining profits ( murabahah) or financing of capital goods based on the principle of leased mummies without choice (ijarab) or with the option of transferring ownership of goods leased from the bank by another party (ijarap wa iqtina). Banking services include:

- Money transfer services (transfer)
- Billing services (collections)
- Clearing services
- Foreign currency sales services (foreign exchange)
- Safe deposit box for Travelers check Bank card
- Bank draft
- Letter of credit (L / C)
- Bank guarantees and bank references