Explore how lending and payments change three banks
Each bank obeys cash + loans = deposits + capital. A new loan creates a deposit at the lending bank. When that deposit is paid to another bank, deposits and settlement cash move between banks. All amounts are illustrative £ millions.
Start with the Lecture 2 example: Goodwin lends £4, then £1 is paid to Middleton and £3 to Hestor. Click Run lecture example to see the two steps.
Student challenge mode
Predict → transact → explain → receive feedback. Use the transaction controls below to complete each task.
Make a prediction before the next transaction.
Prediction
Select an answer to begin.
Progress and bank-management dashboard
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Formative score: correct predictions and completed accounting tasks. Not a regulatory bank rating.
Student explanation
Make a transaction
Transactions are applied only if the resulting cash, loans, deposits and capital remain non-negative. There is no automatic borrowing from the central bank. External cash deposits and withdrawals cross the boundary of this three-bank system.