Infinite banking is a strategic method of using yourself as a bank. Specifically, your universal life insurance acts as your bank, and you take out a loan against the cash value. Your policy receives money from your premiums and earns interest on top of that. You may also qualify for additional dividends. Insurance companies typically have lower interest rates on loans than actual banks, and you are not taking out the money from inside the policy, allowing it to grow even more. This means you are still earning money from the policy while you pay back the loan. Banks also have more complicated processes for taking out loans while an insurance company has a simple process.