Banking – A History and Function
Banking is a comprehensive wide term
in which different types of financial activity take places. In other words – a
system or place where we put our money or valuable things for safety purpose
and take back or withdrawal according to our need or requirement. Bank system
deal in money, it takes money from depositor on a low rate and gives it to
industries on other/higher rates according to their needs. In past time lot of
people involve in these types of activity like – shroffs, seths, mahajans,
baniya or sahukar etc.
Our first bank, Bank of Hindustan is
entirely managed by out sides of India. After that bank of Bengal (1806), Bank
of Bombay (1840) or Bank of Madras (1846). After freedom, the State bank of
India was formed in 1955 for main financial activity in India. It is
responsible for new branches in different area of India and other mutual
benefit.
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| Banking – A History and Function |
Different functions & activity
of a commercial bank –
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Facility for depositors: - bank means motivation for
saving, it also pay interest on summit amount and also provide lockers for
valuables things. It also involve different settlements like cheques, DD, bill
payments or tax etc.
ü
Loan: - commercial bank provides
financial support to small scale or big industries and farmer for a fix time
with low level of interest rates. Mainly bank lend their money like overdraft,
cash, creditor, loans & bill discounts. These facilities also divided into
secured and unsecured loan.
ü
Other services: - bank also buys & sells
share, bond or debentures for their customers. It also pay their regular
payment like tax or premium etc.
