COMMERCIAL BANKS
> Commercial banks are the single most important source of institutional credit in India. A
bank is an institution that accepts deposits of money from the public, withdrawable by
cheque and used for lending.
> Two essential functions which make a financial institution a bank - I. acceptance of
chequable deposits (of money) from the public and II. Lending.
>Three things about deposits are noteworthy:
1.They are deposits of money
2. Deposits are accepted from public at large
3. Deposits are repayable on demand and withdrawable by cheque
> As bank (under the Banking Regulation Act, 1949) is not allowed to carry on any
business of its own (other than that of banking), the word lending is used here broadly
to include both direct lending to borrowers and indirect lending through investment in
open-market securities.
> Commercial banks are the single most important source of institutional credit in India. A
bank is an institution that accepts deposits of money from the public, withdrawable by
cheque and used for lending.
> Two essential functions which make a financial institution a bank - I. acceptance of
chequable deposits (of money) from the public and II. Lending.
>Three things about deposits are noteworthy:
1.They are deposits of money
2. Deposits are accepted from public at large
3. Deposits are repayable on demand and withdrawable by cheque
> As bank (under the Banking Regulation Act, 1949) is not allowed to carry on any
business of its own (other than that of banking), the word lending is used here broadly
to include both direct lending to borrowers and indirect lending through investment in
open-market securities.
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