How do banks typically generate revenue from services?

Banks primarily generate revenue by charging fees and interest for the services they provide. When it comes to lending, banks charge interest on loans, which is a significant source of income. This includes mortgages, auto loans, personal loans, and credit card balances.

In addition to interest income, banks also charge various fees for services such as account maintenance, overdrafts, ATM usage, and wire transfers. These service charges contribute to the bank's profitability, thereby making the model of earning revenue through fees and interest both a fundamental and sustainable business practice for financial institutions.

Other options, such as offering free mortgages, providing government grants, or waiving commission costs, do not align with how banks typically operate in terms of generating revenue. These alternatives would either reduce income streams or contradict the principles of a banking business model.