Banks accept deposits and use the money to make loans, earning a profit from the interest rate spread. They perform key functions like keeping accounts, lending, exchanging currencies, and more. Internally, banks have departments like receiving, paying, loan, and accounting departments to manage deposits, payments, lending, and record keeping. By lending out most of their deposits, banks multiply the amount of money available in the economy to fuel economic growth.

1. GENERAL BANKING

2. BANKING…
 an institution that deals in money and its substitutes
and provides other financial services. Banks accept
deposits and make loans and derive a profit from
the difference in the interest rates paid and
charged, respectively..

3. INDIAN FINANCIAL SYSTEM

4. FUNCTIONS OF BANKING
 The business of a bank consists in buying, selling,
lending, and exchanging money in its different
shapes and forms.
 The transactions of a bank
- Keeping current accounts .
- Receiving deposits
- Discounting bills of exchange.
- Advancing money to customers.
-Transacting business for the account of third
parties.
- Negotiating bills of exchange, Issuing notes

5. BANKING STRUCTURE

6. DEPARTMENTS…
Paying Teller's Department:
 Pays or certifies cheque.
 In charge of the signature book or cards bearing the
authorized signatures of all depositors.
 Ships currency.
 In charge of the vault cash and reserves

7. RECEIVING TELLER'S DEPARTMENT (TELLER):
 Receives deposits.
 Distributes checks to bookkeepers and other
departments.
 Prepares exchanges for clearing house.
 Turns cash over to the paying teller at end of day.

8. NOTE TELLER'S DEPARTMENT
 Collects notes and drafts due at the bank
 Usually in charge of the runners or messenger
department, which is a subdivision.

9. CONTD…
 Collection Department (Teller): Collects notes,
drafts, and other "time" items when payable out of
town. Credits accounts of depositors when
collections are advised paid.
 Transit Department (Teller): This is a subdivision of
the receiving teller's department and may be known
by other terms, such as correspondence, foreign
check, miscellaneous check or country check
department. Assorts checks payable out of town,
endorses them and lists them on letters addressed
to other banks. Gives totals of outgoing or
remittance letters to general ledger bookkeeper at
end of day.

10. CONTD…
 Loan or Discount Department (Executive): Receives
notes submitted for discount or makes loans. Figures
discount and interest. Has charge of collateral securing
loans.
 Credit Department (Executive): Secures and collects
information relating to borrowers. Checks statements
submitted by them. In charge of credit files which
contain information as to the reliability, business habits
and financial strength of borrowers.
 Analysis or Statistical Department (Executive): Usually
found in city banks. Analyzes the accounts of depositors
to determine which are profitable and which are losing
accounts. Makes monthly reports to officers. In charge
of statistics relating to the bank's accounts.

11. CONTD…
 Individual Ledger Department (Bookkeepers):
Keeps the records of the balances of individual
depositors. May be subdivided as to kind of
accounts (savings, dealers), in addition to ordinary
alphabetical division. May balance pass-books or
there may be a separate department for this
purpose using the statement system. Figures
interest on accounts.
 General Ledger Department (Bookkeepers): Keeps
the general or control accounts of the bank. Makes
up the bank's statement of condition.

12. CONTD…
 Country Bank Account Department (Bookkeepers):
Confined to city banks. Keeps the accounts of other
banks, usually consisting of reserve accounts.
 Auditor's Department (Executive): Responsible for
the settlement of the various departments.
Reconciles the accounts with other banks. Certifies
interest calculations.

13. BANK- NATION ECONOMIC GROWTH
 Banks are critical to our economy. The primary
function of banks is to put their account
holders' money to use by lending it out to others
who can then use it to buy homes, businesses,
send kids to college...

14. HOW IT WORKS….
 When a bank gets a deposit of $100, assuming a
reserve requirement of 10 percent, the bank can
then lend out $90. That $90 goes back into the
economy, purchasing goods or services, and
usually ends up deposited in another bank. That
bank can then lend out $81 of that $90 deposit, and
that $81 goes into the economy to purchase goods
or services and ultimately is deposited into another
bank that proceeds to lend out a percentage of it.

15. CONTD…
 In this way, money grows and flows throughout the
community in a much greater amount than
physically exists. That $100 makes a much larger
ripple in the economy.

16. THANK YOU