Discuss The Role Of Commercial Banks In The Economic Development Of A Country Like Pakistan.

Commercial banks play an important role in economic development of developing country. Economic development involves investment in various sectors of economy. The banks collect savings from the people and mobilize saving for investment in industrial project. The investors borrow from banks to finance the projects. Promote the growth rate through the reorientation of loan policy. Special funds are provided to the investors for the completion of projects. The banks provide a guarantee for industrial loan from international agencies. The foreign capital flows to developing countries for investment in projects.

Besides normal banking the banks perform agency services for the client. The banks buy and sell securities, make rent payments, receive subscription funds and collect utility bills for the Government departments. Thus these banks save time and energy of busy peoples. Banks arrange foreign exchange for the business transaction with other countries. The facility of foreign currency account has resulted in an increase of foreign exchange reserves. By opening a letter of credit the banks promote foreign trade.

The banks are not simply collecting funds but also serve as a guide to the customer investment of their funds. The policy of banks is an instrument in wide dispersal of credit in country.

Role of commercial bank  in economic development in bangladesh

In Economic Development,

1. Loan to agriculture and Rural areas.
2. Loan for finished goods like Rice, Wheat and etc.,
3. Financing for Infrastructure
4. Taking over Big giant Industries and financing and keep monitoring their operations.
5. Keep tight security control policy in deposits and securities.
6. Create a organised money creation policy rules.
7. Modern days even they sponsor big events to promote the country tourism.