The banking system is a network of institutions that provide financial services to individuals and businesses. It includes commercial banks, credit unions, and investment banks, which help people save money, borrow funds, and manage investments. These institutions play a crucial role in the economy by facilitating transactions and providing loans for various purposes. Banks accept deposits from customers and use these funds to offer loans, earning interest in the process. They also provide services like checking accounts, savings accounts, and mortgages. Overall, the banking system helps maintain financial stability and supports economic growth by ensuring the flow of money.