What Are The Secondary Functions Of Commercial Banks In Pakistan?

There are following Secondary Functions of Commercial Banks.

When the people want to transfer their amount from one place to another place. They get cheque, draft and TT (Telegraphic Transfer) from the bank. Their money is safeguarded from looting and theft. Bank deducts commission for his services. The people put their valuable things like ornaments, diamond and special document in the lockers of the bank. The bank gets the reward of his supervision.

Bank also provides agency services like receive the electricity bills, telephone, collection of taxes and fee of different universities and boards from the people. The commercial banks invest their available funds in the purchase of securities etc. Moreover, H.B.L has invested money for the establishment of Habib Sugar Mill and U.B.L has invested in United Chemicals etc.

The bank also issue travelers cheques who want to travel. Secondly bank issues letter of credit and gives guarantee that on sending goods, the payment will be made to foreign traders. In this way, the bank facilitates International trade. Some times bank gives valuable advices on various financial matters to their customers. The bank obtains travelers tickets and passport for their customers. The bank underwrites loans raised by the Government, and public bodies.