The document discusses various aspects of banking transactions. It defines what a bank is, noting they accept deposits and provide loans. The document outlines bank characteristics like dealing with money and connecting depositors with borrowers. It also describes key bank functions such as accepting deposits, lending money, transferring funds, and collecting payments. Additionally, the document discusses the types of bank accounts including savings, current, recurring, and term deposits. It provides details on opening an account, like selecting an account type and submitting documents, and highlights advantages of having a bank account like safe money storage and access to loans.

1. BANK TRANSACTIONS
VANITA MODAGI
B.J.P.S Samiti’s
M.V.HERWADKAR ENGLISH MEDIUM
HIGH SCHOOL

2. What is A Bank?
 Word bank is derived from Italian word “Banco” or French word
“banque” – meaning a “Bench” or money exchange table
 Banks are financial institutions which use money deposited by
customers as investments and agreed to return when they need
 Banks also provide loans for potential customers & charge
interest
 Banking system must be strong for any country to develop
 Banks advance money to agriculture, industries, traders and all
other sections of the society
 Services of bank is called Banking
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3. Characteristics of Banks
 Dealing with money
 Individual/firm/company
 Acceptance of deposits from public & return to them when
required
 Lending loans to all sectors & individuals
 Payment & Withdrawal can be done to help customers
 Agency & Utilities services
 Profit & Service Orientation
 Ever increasing functions: Various services & activities
 Connecting link: Between depositors & borrowers
 Banking business
 Name identity
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4. Functions of Banks
 Accepting deposits from public & others
 Lending money to public, institutions or industries
 Transferring money from one place to another or from one
account to another
 Collecting money by cheques, drafts & bills
 Discounting of bills
 Hiring safe deposit lockers to store gold, documents, etc.
 Issuing letters of credit & guarantee
 Conducting government transactions (State & Central)
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5. Bankers & Customers
 Relation between banker & customer can be General or Special
 General relationship:
 Debtor or Creditor relationship
 Subsidiary relationship
 Agent & Principal Relationship
 Special relationship:
 Obligation to honour cheques
 Maintain secrecy of accounts
 Many services are offered by Banks:
 Loans: Credit cards, personal, home, vehicle & business loans
 Mange trading: Mutual funds
 Signature guarantees
 Provide safe deposit lockers
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6. Banking Transactions & Post Offices
 Banking transactions are controlled by Reserve Bank of India (RBI)
which controls all the banks
 RBI formulates the monetary policy which is followed by all banks
 State Bank Groups, 20 Nationalised Banks, 21 Private Banks & 19
Foreign banks – total 8000 bank branches in rural & urban areas
 Postal department planning to start a bank “Postal Bank of India”
 Provide financial services like Postal savings, national savings certificate,
Kissan Vikas Patra, Monthly recurring deposits, Postal life insurance
 Important banks of India are:
 RBI, Commercial, Industrial Development, Land Development, Co-operative,
& Individuals
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7. Types of Bank Accounts
 Generally four kinds of bank accounts
 Savings Bank Account:
 Used by people who have regular income
 Given to students, senior citizens, pensioners, etc.
 Encourage people to save – provides interest
 Current Account:
 Mostly used by businessmen who have large number of regular
transactions with the bank
 Includes deposits & withdrawals on a regular basis – no limit transaction
 No interest is given but some service charge might be collected
 Recurring Deposit Account: opened to serve for a future date
 Term Deposit Account: used to deposit money for a certain
period
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8. Procedure to Open Bank Account
 Select the type of account to open
 Approach a bank & meet them
 Fill bank account proposal form
 Provide reference for opening the account
 Submit the bank account form fully filled in – attach
photograph
 Officer will verify the documents submitted
 Make initial deposit to the account
Mobile Banking, internet banking & credit card details must not be
provided to anyone
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9. Advantages of Opening Bank Account
 Safe custody of money
 Helps in making payments
 Helps in collection of money
 Holders get advances & loans
 Smooth financial transactions
 Safe deposit lockers
 Banks provide:
 Facility to build savings & looking for lending
 Provide no restriction to transactions
 Provide cheques & drafts for collection to concerned account
 Help in providing cash using cheques, ATM cards, or withdawal slips
 Help in paying bills: telephone, water, electricity, credit cards, etc.
 Can help in transfer of bank accounts to different branches.
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