alexa An Interest Rate Commission Agent Banking System
ISSN: 2375-4389

Journal of Global Economics
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Opinion Article

An Interest Rate Commission Agent Banking System

Ameha Tefera Tessema1* and Kruger JW2

1Doctor of Business Leadership, Graduate School of Business Leadership, University of South Africa, South Africa

2Professor, Department of Corporate Finance, University of South Africa, South Africa

*Corresponding Author:
Ameha Tefera Tessema
Doctor of Business Leadership
Graduate School of Business Leadership
University of South Africa, South Africa
Tel: 251-912365549
E-mail: [email protected]

Received August 04, 2015; Accepted October 28, 2015; Published November 04, 2015

Citation:Tessema AT, Kruger JW (2015) An Interest Rate Commission Agent Banking System. J Glob Econ 3:160. doi:10.4172/2375-4389.1000160

Copyright:© 2015 Tessema AT, et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits
unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.



The bank’s toxic or nonperforming asset or contagion and liquidity problems that can prone any time the banking business unsolved for last decades. To solve these problems banks were adopted several models even though each of banking business models was a catalyst for financial crises. However, these problems can be solved applying an interest rate commission agent banking system which is a system to be adopted by bank to be an agent for investors’ loan funding to entrepreneurs by getting the fund seller and buyer agreement to administer the loan after disbursement, by retaining reasonable interest rate commission from the agreed investor’s loan funding credit price. The bank as an agent administer investor’s loan funding to entrepreneur up to loan settlement by collecting an agreed interest rate commission. An interest rate commission agent banking system can directly increase profitability of the bank since no saving interest rate can be paid on the loan disbursed amount from an investor account. Since increasing deposit interest rate increases deposit mobilization. Applying discrete market interest rate incentive also expected to increases the deposit mobilization. In same manner increasing the credit price will increase the demand of the investors to provide loan funding which in turn increase the bank’s loan mobilization.


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