What Are The Kinds Of Banks By Functions?

Commercial bank receives deposits and advance loans to promote business and commerce. Their important functions include making payment against cheques, advancing loans and overdrafts, issuing letters of credit, discounting bills of exchange, transferring of money. Central bank is a bank which is responsible for the financial and economic stability of the country. If offers services to the state and banking industry.  Industrial banks offer valuable services for the development of industries in a country. They offer long-term loans, both in local and foreign currencies, to the industrialist. They prepare feasibility reports on new projects and expansion plans.

The agricultural banks play a vital role in the agriculture field. It provides loans to the farmers, landlords and feudal, to enable them to buy fertilizers, seeds, tractors. Saving bank's objective is to encourage savings of the common man. These small savings, if deposited with the bank, turn into a large amount which is channelled in the development of commerce and trade.. 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.