Ways a banks can reform economic stability

Tax evasion and unethical banking practices around the globe cause financial issues.

13:10 19 May 2013

The recent scandals involving the banking industry have brought a lot of scrutiny from the public as well as the political sectors. It has spawned a movement which encompasses more responsibility from the banking sector, but also prevention of tax evasion which siphons money directly out of an economy.

 

How cracking down on the banking industry can yield positive results:

 

• Interest rates—once things level out with preventing tax evasion and money handling by institutions, interest rates should be set to lower for purchases and increase for investments.

 

• Financial stability—preventing issues within the banking industry is the first step to creating a financially stable economy in any country. It ensures everyone contributes the way they should, and keeps the money circulating in the local economy.

 

• Improved trade—along with the benefits of a more financially stable economy come the improved trade options that a more secure economy can acquire.

 

• Social fund—ensuring that citizens pay their required taxes means there is more money available to help people out and to give back to the community.

 

• Fair pricing—though this will take a while to manifest itself, keeping the banking industry honest and tax monies where they should be mean fewer losses in the local economy which in turn allows prices to eventually lower.

 

These certainly won’t solve all of the problems within the banking industry as well as tax evasion issues, but it’s a significant step towards realizing the problems exist and do impact the country’s economy.

 

These are concerns for all countries, not just the UK, and the more effort made to ensure the banking industry is fair and doesn’t allow tax evasion manoeuvres, the greater the results will be for many countries.

 

Once these issues are addressed the economies will be more aptly reflected and will induce trade and profitable global interactions.