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Who do Central Banks transact with?
Central banks do not transact directly with people or businesses, they only transact with commercial banks. Whereas, commercial banks are the ones who do business and transaction with other banks, businesses, individuals and also the government. Below is a photograph to clearly show their relationship. To put the photo above into context, central banks only transact with commercial banks, while commercial banks both transact with Banks, Businesses, Individuals and also Governments.
