Scribd Logo
Upload

Welcome to Scribd!

  • 17 views

    Commercial Banking

    Uploaded by

    Vishlesh 03014901819

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Commercial Banking

    Uploaded by

    Vishlesh 03014901819
    17 views4 pages

    Original Title

    Commercial banking

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    17 views4 pages

    Commercial Banking

    Uploaded by

    Vishlesh 03014901819

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    You are on page 1of 4

    Commercial banking

    A commercial bank may be defined as a financial institution which is dealing in finance accepts
    deposits against which cheques can be drawn, lends money to commerce and industry and renders a
    number of other useful services to the customers and to the society. Commercial Banks borrow
    money from those who have surplus funds and lend to those who need funds for commercial and
    industrial purposes.

    The commercial banks the following major functions: -

    1. Receiving deposits from public and business firms.


    2. Lending money to various sections of economy for productive activities.
    3. Issue of Demand Draft, Bank Cards, traveler’s cheques for the smooth remittance of funds.
    4. Provision of Locker Facility to the customer.
    5. Safe custody of documents, ornaments and other valuables of customer.
    6. Payment of telephone, electricity and water bills on behalf of customers.
    7. Collection of cheques of the customers.
    8. Issue of letter of credit.
    9. Acting as trustee, executor of wills etc.

    Structure of Commercial Banks


    Scheduled Banks

    Scheduled banks are those banks which are included in 2 nd schedule of RBI act. Those banks
    which satisfy the criteria laid down in section42(6)(A).
    The conditions are: -
    1. The bank must have paid up capital and reserves of an aggregate value of not less than
    Rs.5 lakhs.
    2. Its activities must not be detrimental to the intra stock depositors.
    3. It must be a state cooperative bank or a company incorporated in India under
    Companies Act 1956 or in Institution notified by Central Government or a Corporation or
    a company incorporated outside India.

    Non-Scheduled Banks
    It is a banking company defined in the clause of section 5 of Banking Regulation Act 1949.

    History of Banking
    The first that was started by British was Bank of England in 1694.
    Types of Banking
    1. Branch Banking
    2. Unit Banking
    3. Group Banking
    4. Chain Banking
    5. Universal Banking
    6. Mixed Banking

    Asset Structure Management

    .
     Share Capital is authorized share capital.
    Role of Commercial Banks in Economic Development
    1. Bank Promotes Capital formation
    2. Investment in new enterprise
    3. Promotion of trade and Industry
    4. Development of agriculture
    5. Balanced development of different regions
    6. Influencing economic activities
    7. Implementation of monetary policy
    8. Monetization of the economy - The commercial banks by opening branches in the rural and
    backward areas are reducing the exchange of goods through barter and infusing money by
    opening branches
    9. Export promotion cell - In order to increase the exports of country the commercial banks have
    established export promotion cell. They provide information about general trade and
    economic conditions both inside and outside the country to its customers

    Commercial Banking and their Social Responsibilities in India

    1. Important aspects of Social Orientation


    a. Alignment of credit Policy with the overall objective of the government.
    b. Reduction of Regional disparities in the spread of banking to achieve
    balanced development of the nation.
    c. A lead role in the development of credit at the district level
    d. Greater financial assistance to the weaker sections of society on easier and
    convenient terms.

    2. Social Responsibility of Banks


    a. Responsibility towards Public
    1.1.1. Customer
    1.1.2. Investors
    1.1.3. Suppliers

    b. Responsibility towards Social and Economic environment


    c. Responsibility towards Employees

    You might also like