What Does Banking Mean?

Banking is collectively defined as a profession or industry in which the professionals (known as bankers) are engaged in the business of keeping money. The money deposited by each of the bank's customers is kept in their individual accounts, which are usually savings or current accounts. The bankers also maintain the records and check the accounts at regular intervals and also conduct transactions such as exchange, issuing loans, issuing credit, etc.

Banking is also defined as the transactions of business done with a bank by its customers. These include depositing funds, withdrawing funds, applying for a loan, etc. One of the main functions of a bank is to provide various types of financial services. These services are related to the storing of deposits and the granting of credit. Credit is extended to a person only after checking his or her credit-worthiness (in other words, the financial credibility of a person, or simply, the ability of the person to pay).

Man has always been seeking security and protection. This need has led him to scientific and technological development on one hand, and banking development on the other hand. In modern times the banking has become so necessary that if it is excluded from any economic system the whole business and economic world will collapse like house of cards. Man has always found himself in the pursuit of safety and convenience. If we dig into the history we will come to know that his persistent effort to achieve these two targets brought him blessings in the form of not only evolution and later revolution in science and technology but also in the banking field.

Today banking has assumed that high importance; you just withdraw and exclude it the whole economic and financial will collapse. In the days gone by when man started saving money he felt himself unsecured. First he buried his savings underground. But this practice did not last long for its shortcomings. Consequently, he restored to deposit his savings with the strong and robust person for safekeeping who hired armed guards on wages. These trustees charged fee from depositors to earn livelihood and finance the expenditure on armed guards.