SlideShare a Scribd company logo

Functions of banks

1 of 13
Download to read offline
 BANKING FUNCTIONS
Definition:-
Banking has been defined as
“Accepting for the purpose of lending &
investment, of deposit of money from the public,
repayable on demand order or otherwise and
withdraw able by cheque, draft or otherwise.”
Meaning:-
Banking means transacting business
with a bank; depositing or withdrawing funds or
requesting a loan etc.
 The development of banking is evaluation in
nature. The origin of the word bank can be
traced back to the German word „Banck‟ and
Italian word „Banco‟ which means heap of
money.
Banking is an old concept in India. It
was present in ancient Vedic times. There
were bankers known as „Sheth‟, „Shah‟,
„Shroff‟ or „Chettiar‟ who were performing the
function of bank.
 The main functions of banks are accepting deposit and
lending loans:
A – accepting deposits
1. Fixed deposits:- These deposits mature after a
considerable long period like 1 year or more than that the
rate of interest is fixed the amount deposited cannot be
withdrawn before maturity date.
2. Current A/C deposit:- These are mainly maintain by
business community to facilitate frequent transaction with
big amounts. Generally no rate of interest or very low rate
of interest is paid on this account.
3. Savings bank A/C:- It is kind of demand
deposits which is generally kept by the
people for the sake of safety. These facility is
given for small saver and normally a small
rate of interest is paid.
4. Recurring deposit A/C:- In case of
recurring deposit the fixed amount is
deposited in a bank every month for a fixed
period of time.
 B-Lending loans
1. Call loans:- These loan are called back at
any time. Normally, this loans are taken by
bill brokers or stock brokers.
2. Short term loans:- These are sanctioned
for a period up to 1 year.
3.Medium term loans:- These are sanctioned
for the period varying between 1 and 5 years.

Recommended

Functions of Bank
Functions of BankFunctions of Bank
Functions of BankLucky
 
Evolution of banking
Evolution of bankingEvolution of banking
Evolution of bankingVinor5
 
Structure of Indian Banking System
Structure of Indian Banking SystemStructure of Indian Banking System
Structure of Indian Banking SystemDr. S. Bulomine Regi
 
Banking Regulation Act, 1949
Banking Regulation Act, 1949Banking Regulation Act, 1949
Banking Regulation Act, 1949Kajal Bansal
 
Commercial bank
Commercial bank Commercial bank
Commercial bank Daud Dahir
 

More Related Content

What's hot (20)

Commercial bank
Commercial bankCommercial bank
Commercial bank
 
Origin of banking
Origin of bankingOrigin of banking
Origin of banking
 
Banking Function
Banking Function Banking Function
Banking Function
 
Functions of commercial banks
Functions of commercial banksFunctions of commercial banks
Functions of commercial banks
 
Commercial paper
Commercial paperCommercial paper
Commercial paper
 
Functions of commercial banks
Functions of commercial banksFunctions of commercial banks
Functions of commercial banks
 
Paying banker
Paying bankerPaying banker
Paying banker
 
Financial Institutions
Financial InstitutionsFinancial Institutions
Financial Institutions
 
Bill discounting (1)
Bill discounting (1)Bill discounting (1)
Bill discounting (1)
 
Bank lending and principles of sound lending
Bank lending and principles of sound lendingBank lending and principles of sound lending
Bank lending and principles of sound lending
 
Classification of banks
Classification of banksClassification of banks
Classification of banks
 
Banking ppt
Banking pptBanking ppt
Banking ppt
 
Types of Banks
Types of BanksTypes of Banks
Types of Banks
 
Money markets
Money marketsMoney markets
Money markets
 
Ppt on-money-market-1
Ppt on-money-market-1Ppt on-money-market-1
Ppt on-money-market-1
 
Commercial Banking System
Commercial Banking SystemCommercial Banking System
Commercial Banking System
 
Rights and obligations of banker
Rights and obligations of bankerRights and obligations of banker
Rights and obligations of banker
 
Indian financial system
Indian financial systemIndian financial system
Indian financial system
 
Relationship Between Banker and Customer
Relationship Between Banker and CustomerRelationship Between Banker and Customer
Relationship Between Banker and Customer
 
Indian banking structure
Indian banking structureIndian banking structure
Indian banking structure
 

Viewers also liked

Indian finanacial Market
Indian finanacial MarketIndian finanacial Market
Indian finanacial MarketMubashir Hassan
 
Types of banks
Types of banksTypes of banks
Types of banks17somya
 
functions and structure
 functions and structure  functions and structure
functions and structure nileshsen
 
Banking in Pakistan
Banking in PakistanBanking in Pakistan
Banking in PakistanObopay
 
types of accounts in a bank
types of accounts in a banktypes of accounts in a bank
types of accounts in a bankBrijesh Sancheti
 
Banking regulation-act-1949
Banking regulation-act-1949Banking regulation-act-1949
Banking regulation-act-1949Raju ammu
 
Reserve Bank Of India : Role ,Functions Structure and Management
Reserve Bank Of India : Role ,Functions Structure and ManagementReserve Bank Of India : Role ,Functions Structure and Management
Reserve Bank Of India : Role ,Functions Structure and ManagementBinto Mathachan
 
Principles of bank lending
Principles of bank lendingPrinciples of bank lending
Principles of bank lendingDevang Sadrani
 
Presentation on Types of Banking
Presentation on Types of BankingPresentation on Types of Banking
Presentation on Types of BankingKamlesh Thakur
 
Retail banking ppt
Retail banking pptRetail banking ppt
Retail banking pptAmit Saini
 
Banks in pakistan
Banks  in pakistanBanks  in pakistan
Banks in pakistanAli Kamran
 
Credit appraisal in banking sbi
Credit appraisal in banking sbi Credit appraisal in banking sbi
Credit appraisal in banking sbi Babasab Patil
 
Banking sector of pakistan
Banking sector of pakistanBanking sector of pakistan
Banking sector of pakistanObaid Khan
 
Bank system in pakistan
Bank system in pakistanBank system in pakistan
Bank system in pakistanMian Usman
 

Viewers also liked (20)

Indian finanacial Market
Indian finanacial MarketIndian finanacial Market
Indian finanacial Market
 
Types of banks
Types of banksTypes of banks
Types of banks
 
functions and structure
 functions and structure  functions and structure
functions and structure
 
Banking in Pakistan
Banking in PakistanBanking in Pakistan
Banking in Pakistan
 
types of accounts in a bank
types of accounts in a banktypes of accounts in a bank
types of accounts in a bank
 
Banking regulation-act-1949
Banking regulation-act-1949Banking regulation-act-1949
Banking regulation-act-1949
 
different types of loans in india
different types of loans in indiadifferent types of loans in india
different types of loans in india
 
Reserve Bank Of India : Role ,Functions Structure and Management
Reserve Bank Of India : Role ,Functions Structure and ManagementReserve Bank Of India : Role ,Functions Structure and Management
Reserve Bank Of India : Role ,Functions Structure and Management
 
Principles of bank lending
Principles of bank lendingPrinciples of bank lending
Principles of bank lending
 
Banking regulation act
Banking regulation actBanking regulation act
Banking regulation act
 
Banking regulation act.
Banking regulation act.Banking regulation act.
Banking regulation act.
 
Presentation on Types of Banking
Presentation on Types of BankingPresentation on Types of Banking
Presentation on Types of Banking
 
Sarfaesi Act
Sarfaesi ActSarfaesi Act
Sarfaesi Act
 
Retail banking ppt
Retail banking pptRetail banking ppt
Retail banking ppt
 
Banks in pakistan
Banks  in pakistanBanks  in pakistan
Banks in pakistan
 
Credit appraisal in banking sbi
Credit appraisal in banking sbi Credit appraisal in banking sbi
Credit appraisal in banking sbi
 
Banking sector of pakistan
Banking sector of pakistanBanking sector of pakistan
Banking sector of pakistan
 
Types of banks in pakistan
Types of banks in pakistanTypes of banks in pakistan
Types of banks in pakistan
 
Bank system in pakistan
Bank system in pakistanBank system in pakistan
Bank system in pakistan
 
Types Of Customers
Types Of CustomersTypes Of Customers
Types Of Customers
 

Similar to Functions of banks

savings bank account services by karnataka bank
savings bank account services by karnataka banksavings bank account services by karnataka bank
savings bank account services by karnataka bankAprameya joshi
 
Unit 1 to 5 blp notes
Unit 1 to 5 blp notesUnit 1 to 5 blp notes
Unit 1 to 5 blp notesThangaraja T
 
Unit 1 to 5 blp notes
Unit 1 to 5 blp notesUnit 1 to 5 blp notes
Unit 1 to 5 blp notesThangaraja T
 
BANKING AND FINANCE.pptx
BANKING AND FINANCE.pptxBANKING AND FINANCE.pptx
BANKING AND FINANCE.pptxDrNeerjaSharma
 
Functions of commercial bank
Functions of commercial bankFunctions of commercial bank
Functions of commercial bankMuskanDhawan7
 
financial institution.pptx
financial institution.pptxfinancial institution.pptx
financial institution.pptxpriyanka862870
 
commercial bank.ppt
commercial bank.pptcommercial bank.ppt
commercial bank.pptRichaGoel44
 
Group 10- Commercial Banking.pptx
Group 10- Commercial Banking.pptxGroup 10- Commercial Banking.pptx
Group 10- Commercial Banking.pptxKrishnaParab13
 
Ifmpresentation1 130704094735-phpapp01
Ifmpresentation1 130704094735-phpapp01Ifmpresentation1 130704094735-phpapp01
Ifmpresentation1 130704094735-phpapp01anithathottasseri
 
Banking system BA.pptx
Banking system BA.pptxBanking system BA.pptx
Banking system BA.pptxranjanishukla1
 
Commercial banks economics by vsnv ppt
Commercial banks economics by vsnv    pptCommercial banks economics by vsnv    ppt
Commercial banks economics by vsnv pptVaishnavGroup
 
Functions of Commercial Banks in India
Functions of Commercial Banks in IndiaFunctions of Commercial Banks in India
Functions of Commercial Banks in IndiaVadivelM9
 
Financeinenterprisemanagement
FinanceinenterprisemanagementFinanceinenterprisemanagement
FinanceinenterprisemanagementMARISSA TAN
 
Commercial bank and its functions
Commercial bank and its functionsCommercial bank and its functions
Commercial bank and its functionsKumar Nirmal Prasad
 

Similar to Functions of banks (20)

savings bank account services by karnataka bank
savings bank account services by karnataka banksavings bank account services by karnataka bank
savings bank account services by karnataka bank
 
Unit 1 to 5 blp notes
Unit 1 to 5 blp notesUnit 1 to 5 blp notes
Unit 1 to 5 blp notes
 
Unit 1 to 5 blp notes
Unit 1 to 5 blp notesUnit 1 to 5 blp notes
Unit 1 to 5 blp notes
 
BANKING AND FINANCE.pptx
BANKING AND FINANCE.pptxBANKING AND FINANCE.pptx
BANKING AND FINANCE.pptx
 
Functions of commercial bank
Functions of commercial bankFunctions of commercial bank
Functions of commercial bank
 
financial institution.pptx
financial institution.pptxfinancial institution.pptx
financial institution.pptx
 
commercial bank.ppt
commercial bank.pptcommercial bank.ppt
commercial bank.ppt
 
Group 10- Commercial Banking.pptx
Group 10- Commercial Banking.pptxGroup 10- Commercial Banking.pptx
Group 10- Commercial Banking.pptx
 
Indian financial system
Indian financial systemIndian financial system
Indian financial system
 
Ifmpresentation1 130704094735-phpapp01
Ifmpresentation1 130704094735-phpapp01Ifmpresentation1 130704094735-phpapp01
Ifmpresentation1 130704094735-phpapp01
 
WHAT IS A BANK, CLASSIFY AND DISCUSS BANKS.
WHAT IS A BANK, CLASSIFY AND DISCUSS BANKS.WHAT IS A BANK, CLASSIFY AND DISCUSS BANKS.
WHAT IS A BANK, CLASSIFY AND DISCUSS BANKS.
 
Meenu 2
Meenu 2Meenu 2
Meenu 2
 
Banking
BankingBanking
Banking
 
Banking system BA.pptx
Banking system BA.pptxBanking system BA.pptx
Banking system BA.pptx
 
Commercial banks economics by vsnv ppt
Commercial banks economics by vsnv    pptCommercial banks economics by vsnv    ppt
Commercial banks economics by vsnv ppt
 
banking law and precedent
 banking law and precedent banking law and precedent
banking law and precedent
 
Functions of Commercial Banks in India
Functions of Commercial Banks in IndiaFunctions of Commercial Banks in India
Functions of Commercial Banks in India
 
Finance Enterprise Management
Finance Enterprise ManagementFinance Enterprise Management
Finance Enterprise Management
 
Financeinenterprisemanagement
FinanceinenterprisemanagementFinanceinenterprisemanagement
Financeinenterprisemanagement
 
Commercial bank and its functions
Commercial bank and its functionsCommercial bank and its functions
Commercial bank and its functions
 

More from Neeta Sharma

Economic system 2 types, advantages, and disadvantages
Economic system 2 types, advantages, and disadvantagesEconomic system 2 types, advantages, and disadvantages
Economic system 2 types, advantages, and disadvantagesNeeta Sharma
 
Definition of business policy
Definition of business policyDefinition of business policy
Definition of business policyNeeta Sharma
 
40 icebreakers for small groups
40 icebreakers for small groups40 icebreakers for small groups
40 icebreakers for small groupsNeeta Sharma
 

More from Neeta Sharma (7)

Economic system 2 types, advantages, and disadvantages
Economic system 2 types, advantages, and disadvantagesEconomic system 2 types, advantages, and disadvantages
Economic system 2 types, advantages, and disadvantages
 
Functions of rbi
Functions of rbiFunctions of rbi
Functions of rbi
 
Principles
PrinciplesPrinciples
Principles
 
Principles
PrinciplesPrinciples
Principles
 
Definition of business policy
Definition of business policyDefinition of business policy
Definition of business policy
 
40 icebreakers for small groups
40 icebreakers for small groups40 icebreakers for small groups
40 icebreakers for small groups
 
Consumer behviour
Consumer behviourConsumer behviour
Consumer behviour
 

Recently uploaded

National Income National Income National Income
National Income National Income National IncomeNational Income National Income National Income
National Income National Income National Income19920606201903202019
 
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptx
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptxSlideshare - ONS Economic Forum Slidepack - 19 February 2024.pptx
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptxOffice for National Statistics
 
The Case for Commodities as an Asset Class.ppt
The Case for Commodities as an Asset Class.pptThe Case for Commodities as an Asset Class.ppt
The Case for Commodities as an Asset Class.pptJinzhiFeng1
 
E-learning Personal Finance Management - with design v2 .pptx
E-learning Personal Finance Management - with design v2 .pptxE-learning Personal Finance Management - with design v2 .pptx
E-learning Personal Finance Management - with design v2 .pptxakinsumboayomide
 
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdfAdnet Communications
 
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...Työeläkeyhtiö Elo
 
Q4 2023 Conference Call Presentation FINAL-v4.pdf
Q4 2023 Conference Call Presentation FINAL-v4.pdfQ4 2023 Conference Call Presentation FINAL-v4.pdf
Q4 2023 Conference Call Presentation FINAL-v4.pdfAdnet Communications
 
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptx
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptxAGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptx
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptxVISHALI SELVAM
 
business-model-canvas for collaborative business
business-model-canvas for collaborative businessbusiness-model-canvas for collaborative business
business-model-canvas for collaborative businessramijadpro
 
Shrambal_Distributors_February_Newsletter_2024.pdf
Shrambal_Distributors_February_Newsletter_2024.pdfShrambal_Distributors_February_Newsletter_2024.pdf
Shrambal_Distributors_February_Newsletter_2024.pdfvikashdidwania1
 
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...Adrian Sanabria
 
Stock Market Brief Deck from youtube 2/16
Stock Market Brief Deck from youtube 2/16Stock Market Brief Deck from youtube 2/16
Stock Market Brief Deck from youtube 2/16Michael Silva
 
99MW Nearshore Wind Farm in Colombia.pdf
99MW Nearshore Wind Farm in Colombia.pdf99MW Nearshore Wind Farm in Colombia.pdf
99MW Nearshore Wind Farm in Colombia.pdfVictoriaGaleano
 
TIM GROUP FY '23 Preliminary Results.pdf
TIM GROUP FY '23 Preliminary Results.pdfTIM GROUP FY '23 Preliminary Results.pdf
TIM GROUP FY '23 Preliminary Results.pdfGruppo TIM
 
2023_-_Master_Trust___GPP_Defaults_Report (2).pdf
2023_-_Master_Trust___GPP_Defaults_Report (2).pdf2023_-_Master_Trust___GPP_Defaults_Report (2).pdf
2023_-_Master_Trust___GPP_Defaults_Report (2).pdfHenry Tapper
 
Cultural background and entrepreneurial spirit in retail - European Business ...
Cultural background and entrepreneurial spirit in retail - European Business ...Cultural background and entrepreneurial spirit in retail - European Business ...
Cultural background and entrepreneurial spirit in retail - European Business ...Antonis Zairis
 
Stock Market Brief Deck for 2/21/24 .pdf
Stock Market Brief Deck for 2/21/24 .pdfStock Market Brief Deck for 2/21/24 .pdf
Stock Market Brief Deck for 2/21/24 .pdfMichael Silva
 
Stock Market Brief Deck for 2:22 youtube vid.pdf
Stock Market Brief Deck for 2:22 youtube vid.pdfStock Market Brief Deck for 2:22 youtube vid.pdf
Stock Market Brief Deck for 2:22 youtube vid.pdfMichael Silva
 

Recently uploaded (20)

National Income National Income National Income
National Income National Income National IncomeNational Income National Income National Income
National Income National Income National Income
 
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptx
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptxSlideshare - ONS Economic Forum Slidepack - 19 February 2024.pptx
Slideshare - ONS Economic Forum Slidepack - 19 February 2024.pptx
 
The Case for Commodities as an Asset Class.ppt
The Case for Commodities as an Asset Class.pptThe Case for Commodities as an Asset Class.ppt
The Case for Commodities as an Asset Class.ppt
 
E-learning Personal Finance Management - with design v2 .pptx
E-learning Personal Finance Management - with design v2 .pptxE-learning Personal Finance Management - with design v2 .pptx
E-learning Personal Finance Management - with design v2 .pptx
 
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf
20240220 Calibre Q4 and FY 2023 Conference Call Present.pdf
 
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...
Elo’s result 2023: Return on investment increased to 6 per cent and cost effi...
 
Veritas Financial statement presentation 2023
Veritas Financial statement presentation 2023Veritas Financial statement presentation 2023
Veritas Financial statement presentation 2023
 
Q4 2023 Conference Call Presentation FINAL-v4.pdf
Q4 2023 Conference Call Presentation FINAL-v4.pdfQ4 2023 Conference Call Presentation FINAL-v4.pdf
Q4 2023 Conference Call Presentation FINAL-v4.pdf
 
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptx
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptxAGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptx
AGRICULTURAL PRICE POLICY -AGRICULTURAL ECONOMICS.pptx
 
business-model-canvas for collaborative business
business-model-canvas for collaborative businessbusiness-model-canvas for collaborative business
business-model-canvas for collaborative business
 
Shrambal_Distributors_February_Newsletter_2024.pdf
Shrambal_Distributors_February_Newsletter_2024.pdfShrambal_Distributors_February_Newsletter_2024.pdf
Shrambal_Distributors_February_Newsletter_2024.pdf
 
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...
Indistinguishable from Magic: How the Cybersecurity Market Reached a Trillion...
 
Stock Market Brief Deck from youtube 2/16
Stock Market Brief Deck from youtube 2/16Stock Market Brief Deck from youtube 2/16
Stock Market Brief Deck from youtube 2/16
 
99MW Nearshore Wind Farm in Colombia.pdf
99MW Nearshore Wind Farm in Colombia.pdf99MW Nearshore Wind Farm in Colombia.pdf
99MW Nearshore Wind Farm in Colombia.pdf
 
TIM GROUP FY '23 Preliminary Results.pdf
TIM GROUP FY '23 Preliminary Results.pdfTIM GROUP FY '23 Preliminary Results.pdf
TIM GROUP FY '23 Preliminary Results.pdf
 
2023_-_Master_Trust___GPP_Defaults_Report (2).pdf
2023_-_Master_Trust___GPP_Defaults_Report (2).pdf2023_-_Master_Trust___GPP_Defaults_Report (2).pdf
2023_-_Master_Trust___GPP_Defaults_Report (2).pdf
 
Monthly Economic Monitoring of Ukraine No.229, February 2024
Monthly Economic Monitoring of Ukraine No.229, February 2024Monthly Economic Monitoring of Ukraine No.229, February 2024
Monthly Economic Monitoring of Ukraine No.229, February 2024
 
Cultural background and entrepreneurial spirit in retail - European Business ...
Cultural background and entrepreneurial spirit in retail - European Business ...Cultural background and entrepreneurial spirit in retail - European Business ...
Cultural background and entrepreneurial spirit in retail - European Business ...
 
Stock Market Brief Deck for 2/21/24 .pdf
Stock Market Brief Deck for 2/21/24 .pdfStock Market Brief Deck for 2/21/24 .pdf
Stock Market Brief Deck for 2/21/24 .pdf
 
Stock Market Brief Deck for 2:22 youtube vid.pdf
Stock Market Brief Deck for 2:22 youtube vid.pdfStock Market Brief Deck for 2:22 youtube vid.pdf
Stock Market Brief Deck for 2:22 youtube vid.pdf
 

Functions of banks

  • 2. Definition:- Banking has been defined as “Accepting for the purpose of lending & investment, of deposit of money from the public, repayable on demand order or otherwise and withdraw able by cheque, draft or otherwise.” Meaning:- Banking means transacting business with a bank; depositing or withdrawing funds or requesting a loan etc.
  • 3.  The development of banking is evaluation in nature. The origin of the word bank can be traced back to the German word „Banck‟ and Italian word „Banco‟ which means heap of money. Banking is an old concept in India. It was present in ancient Vedic times. There were bankers known as „Sheth‟, „Shah‟, „Shroff‟ or „Chettiar‟ who were performing the function of bank.
  • 4.  The main functions of banks are accepting deposit and lending loans: A – accepting deposits 1. Fixed deposits:- These deposits mature after a considerable long period like 1 year or more than that the rate of interest is fixed the amount deposited cannot be withdrawn before maturity date. 2. Current A/C deposit:- These are mainly maintain by business community to facilitate frequent transaction with big amounts. Generally no rate of interest or very low rate of interest is paid on this account.
  • 5. 3. Savings bank A/C:- It is kind of demand deposits which is generally kept by the people for the sake of safety. These facility is given for small saver and normally a small rate of interest is paid. 4. Recurring deposit A/C:- In case of recurring deposit the fixed amount is deposited in a bank every month for a fixed period of time.
  • 6.  B-Lending loans 1. Call loans:- These loan are called back at any time. Normally, this loans are taken by bill brokers or stock brokers. 2. Short term loans:- These are sanctioned for a period up to 1 year. 3.Medium term loans:- These are sanctioned for the period varying between 1 and 5 years.
  • 7. These loan are sanctioned for a period of more than 5 years it includes: 1. Overdraft:- The bank grants overdraft facility to its reliable and respectable depositors. It enables companies, firms and businessmen to withdraw amount over and above their actual balance in their current account. 2. Cash credit: Under this facility, the bank allows the borrower to withdraw cash against certain security. 3. Bills of Exchange:- The bank provide funds to their customers by purchasing or discounting bills of exchange. The bank charges commission up to the maturity period of bills.
  • 8. Apart from the main functions, the banks also provide financial services to the corporate sector and business and society. They are as follows: 1.Merchant Banking:- Merchant banking is an organization which underwrites securities for companies, advises in various activities. No person is allowed to carry out any activity as a Merchant Banker unless holds a certificate granted by SEBI. Thus, merchant banks are financial institutions which provide specialized services including acceptance of bills of exchange, corporate finance, portfolio management and other services.
  • 9. 2. Leasing:- Banks have started funding the fixed assets through leasing. It refers to the renting out of immovable property by the bank to the businessmen on a specified rent for a specific period on terms which may be mutually agreed upon. A written agreement is made in this respect. 3.Mutual funds:- The main function of mutual fund is to mobilize the savings of the general public and invest them in stock market and money market.
  • 10. 4. Venture Capital (VC):-Venture Capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as biotechnology, IT, software, etc.
  • 11. 5. ATM:- An ATM is also known as cash point. The banks nowadays provide ATM facilities. The customers can withdraw money easily and quickly 24 hours a day. 6. Telebanking:- Telebanking is a throwback to the days when people would call into a central number at their bank/financial institution in order to get balance, check status and other account-related information. Most financial organizations offer telebanking services today; however, the public representation is known as telephone-based customer service or just customer service.
  • 12. 7. Credit cards:- Credit cards allow a person to buy goods and services up to a certain limit without immediate payment. The amount is paid to the shops, hotel, etc. by the commercial banks. 8. Locker Service:- Under this service, lockers are provided to the public in various sizes on payment of fixed rent. Customers can deposit their valuables, documents, jewellery, securities, etc. in these lockers.
  • 13. 9. Underwriting:- This facility is provided to the joint stock companies and to the government. The banks guarantee the purchase of certain proportion of shares, if not sold in the market.