Learn modern banking practices and procedures | Alison

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Introduction to Banking - Revised

Learn more about basic banking practices and how they influence economies around the world, with this banking course.

Finances and Banking
Free Course
This free online Introduction to Banking course will discuss the fundamentals of modern banking practices. Banking is a key driver of any country's economy, with several large banks operating globally and holding offices internationally from New York to Hong Kong. Banks allow families to gain mortgages, businesses to start up, and savings to accrue safely. With this course, you will learn more about these major international institutions.
  • Duration

    5-6 Hours
  • Assessment

  • Certification

  • Responsive

  • Publisher

    Khan Academy





View course modules


There's a lot more to a bank than just depositing and withdrawing money. This course will give you an overview of how the banking system operates and introduce you to what a bank's income statement actually contains. You will also cover common terms used in banking such as multiplier effect, money supply, bank notes, and cheques, and learn their definitions and importance. You will then be guided through the important topics of loans and reserve ratios.

Leverage and treasuries are common banking terms that we often hear but do not fully understand. This course will give you a deeper understanding of these topics. You will study reserve banking, open market operations, fed funds rate, discount rate, and the federal reserve balance sheet. You will then be given an overview of federal reserve banking, deposit insurance, and the London Interbank Offer Rate (LIBOR) to help you understand their significance in the banking system.

The banking system plays an important role in the economic sector of every country in the world. It facilitates the flow of funds in the economy and ensures that financial resources are allocated efficiently towards promoting the development and growth of a nation. Whether we like it or not, banks are embedded in our everyday lives with activities like withdrawing salaries, paying bills, and depositing money as savings. By the end of this course, you will have a much better understanding of how this crucial element of modern life operates.

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Learning Outcomes

Have completed this course you will be able to:

  • Discuss fractional reserve banking.
  • Discuss fundamentally how a bank and banking system works.
  • Explain fundamental banking terms such as reserve ratio, liquidity, leverage, equity, etc.
  • Recognise how Fractional Reserve banking works. Review treasuries release by the US government.
  • Explain the difference between a repurchase agreement and loan collateral.
  • Explain what LIBOR is and how the banks make use of it.


All Alison courses are free to enrol, study and complete. To successfully complete this Certificate course and become an Alison Graduate, you need to achieve 80% or higher in each course assessment. Once you have completed this Certificate course, you have the option to acquire an official Certificate, which is a great way to share your achievement with the world. Your Alison Certificate is:

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