Tianliangyuan

Chapter 357 If you can borrow money, why can't you save it?

Fu Pei stood there for a while, then stammered, "That makes sense! Those are indeed two major advantages, but... but my mind is a bit muddled right now. County Princess?"

Xu Zhaozhao chuckled twice: "It's very simple. We can lower the interest rate, or we can change the monthly interest rate to an annual interest rate. In this way, although the money the pawnshop receives will be less, it will still have income. Moreover, for ordinary people, such emergency relief money is not a particularly big burden, and they will not have to insist on selling houses and land to repay it."

indeed so!

Xu Han stroked his beard, agreeing with his daughter's assessment.

"That's good! By extending the repayment period and changing the monthly interest rate to an annual interest rate, the interest is reduced, which is indeed beneficial to the people. Moreover, the money shops are not lending money for nothing. One or two loans may not seem like much, but if there are many loans and the amount is large, the profit will naturally become apparent."

Xu Junan nodded in agreement.

Xie Zheng, who was standing nearby, was the first to notice the problem: "That's not right! But the money in the store is only going out, and the amount coming in is small, and the time frame is long, so where does he get the money to lend out?"

Xu Zhaozhao raised an eyebrow, her eyes shining.

As expected of the man she chose, he's so smart!

That's a really sharp mind.

Xu Zhaozhao patiently explained, "If people can borrow money from outside, why can't they deposit money into the system?"

This was a new term and a new direction, which immediately left Fu Pei speechless.

Xu Zhaozhao gave him too much of a shock!

Fu Pei felt he needed to slow down.

"For example, if you deposit ten strings of cash with me on a fixed-term deposit for a year, I will give you one hundred cash in interest for the year. When the year is up, you can come and collect it. It's like you earned one hundred cash back with your ten strings of cash without doing anything. I then used your ten strings of cash to lend to him."

Xu Zhaozhao pointed at Fu Pei, meaning that the money Xu Junan had deposited should be directly loaned to Fu Pei.

“He lent me ten strings of cash, and I need to pay him two hundred coins in interest every year. When the year is up, he needs to repay me ten strings and two hundred coins. I will give you ten strings and one hundred coins back. In this way, I don’t need to pay any costs or do any business. I can just lie at home and earn one hundred coins a year.”

Everyone opened their mouths.

Xu Zhaozhao's explanation surprised everyone.

Even Xie Zheng, who had been calm and composed just moments before, couldn't help but gape in shock!

Xu Zhaozhao glanced at the surprised expressions on their faces, nodded slightly, and was quite satisfied.

"This is just ten strings of cash. Take Chang'an County as an example. As far as I know, the population of Chang'an County is about 400,000. If only one out of every four people in these 400,000 is an adult male, then that's 100,000 people. And if only 10% of these 100,000 people have spare money to save, that's 10,000 people."

Ten strings of cash is not a small amount, and not everyone is willing to deposit the money for a year without moving it. So, let's halve that: out of 10,000 people, only 5,000 are willing to deposit ten strings of cash.

Then, the accounts came in.

If 5,000 people each deposit 10 strings of cash for a one-year fixed term, that's 50,000 strings of cash! If I can earn 100 coins from each 10 strings of cash, then with 5,000 people, I can earn 50,000 coins, which is 50 strings of cash!

Therefore, if I set up such a shop in Chang'an County, I conservatively estimate my net profit would be fifty strings of cash. If I were just a small family, that would be enough to support my family's expenses for a year, ensuring we would have no worries about food and clothing.

This is only Chang'an County!

This is only based on 5,000 people, and each person was only given an example of 10 strings of cash.

In reality, the capital was prosperous, and there were many wealthy merchants and gentry in Chang'an County. Those rich people could easily come up with not only ten strings of cash, but even one hundred thousand strings!

For a moment, Fu Pei felt his breathing become heavy.

That's all money!

What is Your Majesty most worried about now?

It's the national treasury!

Previously, Xu Junting, Wang Wenyuan, and others had relieved His Majesty's worries and finally found a way to solve the problem of food for the people.

But the national treasury needs not only grain, but also money!

Should border guards be paid military pay and given various supplies?

The territory of Daxing is vast, and every year there are all kinds of disasters or human-caused disasters. Should the imperial court provide relief with money and grain?

Money is needed everywhere!

Fu Pei felt as if he had found a way to replenish the national treasury.

But not enough.

"Your Highness, I've remembered what you just said about fixed-term savings, and you mentioned a full year. But what if I want to deposit for a shorter period? For example, I have ten strings of cash, but I need to use it in two months and don't want to leave it at home to attract thieves. What should I do?"

"That's easy!"

Xu Zhaozhao smiled. This Lord Fu truly has a brilliant mind.

They really do find the key points very quickly.

"Let's take ten strings of cash as an example again. If you have ten strings of cash and only plan to deposit it for two months, then you can't complete a regular savings plan. And there must be many people like you. Although the amount of money is small and depositing and withdrawing it is a bit troublesome, it is still a form of income. Therefore, we can have a special way of depositing money, which is to deposit and withdraw at any time!"

Fu Pei frowned; he seemed to understand.

"Does the county magistrate mean that I can deposit my ten strings of cash into the bank at any time, or withdraw it at any time?"

Xu Zhaozhao nodded: "That's right."

"But how should the interest be calculated?"

"Simple! As I just said, this method is troublesome, but it's very convenient for ordinary people. Therefore, this kind of business will definitely be the most common. So, whether you're an ordinary person or a merchant, you can't have both for the money counter. You want high interest rates and you want to withdraw money anytime? There's no such thing as a free lunch."

Fu Pei nodded unconsciously; that made sense.

Xie Zheng nodded in agreement. How could you get all the good things?

That doesn't make sense!

"If you deposit your ten strings of cash here, since it's not a fixed-term deposit for a year, the interest will be reduced to only sixty coins per year. So, if you spread it out over a month, it will be five coins. If you deposit it for two months, it will be ten coins. Of course, I'm just using an example, and it's not really going to be done exactly according to the interest rate I mentioned, but I think you understand the general idea, Master Fu."

Fu Pei nodded excitedly, with such force that he almost grabbed his own neck.

"I understand the magistrate's meaning. Brilliant! Truly brilliant!"

Xu Zhaozhao withdrew her smile, looking slightly troubled, and said, "But right now, there is a more pressing issue to resolve."

Fu Pei immediately pressed, "What's the problem?"

Xie Zheng also looked over and followed up with, "Is there still a difficulty?"