Many people who deal with commercial banks, sometimes wonder what the Functions of Commercial Banks are.
Indeed, many people save with commercial banks across the world, yet surprisingly, you still wonder what your commercial bank can do for you.
As a matter of fact, many examining bodies administer tests in this regard to solicit responses from students on what commercial banks really are, according to the understanding of students.
Now, Let me give you a brief background before we go to the main text.
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Brief Background:
Truly, Commercial Bank’s functions are spelled out in the Law that establishes the bank within a specific jurisdiction.
Nevertheless, the functions of commercial across the globe do not differ substantially, as there is a universal principle that guides the operations of all commercial banks in every country, even including the US.
In addition to that, it is a topic that many people conduct research on, especially students preparing for exams and others compiling their projects and thesis.
As a result, Educareguide is here to assist you in to fully understand this topic as well as aid you on how to answer this question in an examination.
The Other Ways Of Asking Question On This Sub-Topic Are:
- What are the roles that a commercial bank play in the development of a country?
- State and explain the main functions performed by a commercial bank.
- What activities do commercial banks perform for their customers?
- Give the functions performed by Commercial banks perform in the development of an economy. ETC.
Furthermore, the sub-topic is an integral part of many Business Management and administration courses in many Schools, Universities, and Colleges.
For example, ABMA UK fully treats this topic in their business administration courses for her students across the world. Now let’s find out the functions that commercial banks perform in our daily lives right below.
The Benefits You Can Get From Your Bank
Indeed, it is absolutely consequent that, your business will certainly grow if your bank can perform these basic services for your business.
The following functions are performed by Commercial banks in the development of an economy for business organizations:
Accepting deposits:
Commercial Banks accept deposits from the general public including savings account, Deposit account, and current account.
They, therefore, provide a safe place for keeping customer’s money.
Granting credit facilities:
These banks grant credit facilities to their customers in the form of loans and overdrafts.
Commercial banks, therefore, provide businessmen with money to finance their activities.
Keeping other valuables:
Commercial banks apart from keeping money also keep customers’ valuables such as wills, certificates, life policies, securities as well as title deeds.
Making payments on behalf of their customers:
They make payments on behalf of their customers upon the written consent of the customers.
Commercial Banks also receive dividends and other monies on behalf of their customers.
Serving as trustees and referees:
Commercial banks serve as trustees and referees for their customers, recommending such customers when necessary to other banks.
Employment:
They also reduce unemployment by employing people in a place, state, or country.
Consultancy:
Also, they provide expert advice on investment and business opportunities to their customer
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