Vocabulary Vault

Speaking · Warm-Up

Explain These Phrases & Make Sentences

Before watching the video, work with a partner. For each phrase below, try to explain what it means and make a sentence using it. You will hear all of these in the video.

have its origins incurrencies in circulationcredit unionscounterfeit moneymiddlemandefault on somethinga calculated riskcrowdfundingin a nutshellrange from … to …spreadenable peopleinterestadopted

Listening · Video

Banking System Explained

Listening · Comprehension

Listen and Answer the Questions

Watch the video and answer the following questions in your own words. Write your answers below, then click "Show Model Answer" to compare.

1

How were banks created?

2

What happened during the financial crisis of 2008?

3

What are credit unions?

4

How is the bank's role changing?

5

What are microcredits and where are they mostly used?

Grammar · Word Formation

Word Formation

Use the word in brackets at the end of each line to form a word that fits in the gap. The word roots are listed on the right as a reference. Type your answers directly into the gaps in the text.

The international banking system is a complex network with over 30,000 banks worldwide holding vast amounts of money. The top 10 banks alone manage 25 trillion US-Dollars. Originally, banking aimed to simplify life. In 11th century Italy, a hub of European trade, faced a problem: too many types of coins. In Pisa, they dealt with seven coin types, leading to constant exchanges. This practice, often conducted on outdoor benches, gave rise to the term "bank," derived from the Italian word "banco" for "bench." Fast forward to today, banks focus on managing risks. People deposit their money and earn a small interest. Banks then lend this money at higher rates, taking risks knowing some borrowers may not repay. This process is vital for our economy, enabling people to buy homes and businesses to grow. Banks transform savings into funds society can utilize. They also earn income from saving deposits, credit cards, currency exchanges, custodian , and cash management. However, many banks have shifted from their traditional role as providers of long-term financial products, favoring short-term gains with higher risks. During financial booms, major banks engaged in complex financial practices, leading to economic damage, such as the 2008 housing market collapse. The aftermath saw governments and unions step in with large bailout to rescue the banks. Today, alternative financing models, like investment banks with yearly fees and credit unions prioritizing shared value, are gaining popularity. Crowdfunding and microcredits have also emerged as funding options, playing a critical role in supporting individuals and businesses worldwide.

Word Roots

1ROUGH

2MERCH

3CALCULATE

4USE

5SERVE

6SIGN

7PACK

8ACCESS

Vocabulary · ABCD Test

Choose the Correct Word

Choose the best option (A, B, C or D) to complete each sentence. All words come from the video and the warm-up phrases.

1

The company decided to ________ a new strategy to deal with the financial crisis.

2

The bank took a ________ risk by lending money to high-risk borrowers.

3

Several borrowers began to ________ their loans during the economic downturn.

4

The new technology ________ small businesses to reach global markets.

5

The startup raised funds through ________ rather than applying for a bank loan.

6

________, the banking system works by taking deposits and lending them out at higher interest rates.

7

The number of credit union members ________ a few hundred to several million.

8

The use of ________ money was a major problem for merchants in medieval Italy.

9

Crowdfunding platforms allow people to get loans without going through a bank as a ________.

10

Banking has its ________ in the trading practices of 11th century Italian merchants.

Speaking · Vocabulary Revision

Use These Words in Conversation

Click a card to expand its definition, example sentence, and IPA pronunciation. Press the speaker icon to hear the British pronunciation. Tick it off once you've used it in conversation.

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