Banks hold your money safely and offer an interest on your deposit that varies depending on your bank. The interest rate is just low compared to the profit they can get on using your money for their own financing.
No, they don't hold your money, they give it out to someone who know how to use your money to make more money through loans.
Your money is insured with the bank even though with max limits
A small bit is insured. Not all of it, especially if your money is stored there in large amounts. Those people have no same in giving you only 10% of what you had in the bank.
but still they guarantee your money compared when you hold it and someone steal it from you at home.
It's not every time that money is stolen unless if you are careless and a show-off. For example, how many times has your crypto been stolen under your custody?