Banks generate income in different ways. One of the sources of income of banks are the interest they earned in their products and services. When bank lends money to borrower, they charge interest on the amount they borrowed that will become the banks earnings. Usually the interest rate is higher than the interest paid to depositors. Another source of income for banks is through fees that are being charged to various services like in ATM the withdrawal fees and balance fees, they also charge transfer fees in overseas wire transfers. Banks also generate income from foreign exchange trading etc.