FUNCTIONS OF

COMMERCIAL BANKS

By: Charles Tuiuane Karita

OBJECTIVES
DEFINITION OF A
BANK.

TYPES OF

COMMERCIAL
BANKS.
FUNCTIONS OF

COMMERCIAL
BANKS.
CONCLUSION.

PREAMBLE
A bank is like a pool into which the flow of

savings, the idle surplus money of

households and from which loans are given
on interest to individuals and others who
need them for investment or productive
uses.

DEFINITION OF A BANK
The Banking Companies Act of India

defines a bank as A Bank is a financial

institution which accepts money from the
public for the purpose of lending or
investment repayable on demand or
otherwise withdrawable by cheques, drafts
or order or otherwise.

TYPES OF COMMERCIAL
BANKS
DEPOSIT BANKS
INDUSTRIAL BANKS
SAVINGS BANKS
EXCHANGE BANKS
AGRICULTURAL BANKS
MISCELLANEOUS BANKS

FUNCTIONS OF COMMERCIAL
BANKS
Commercial banks have to perform a variety of

functions which are common to both developed

and developing countries. These are known as
General Banking functions of the commercial
banks. The modern banks perform a variety of
functions. These can be broadly divided into two
categories:

(a) Primary functions.

(b) Secondary functions.

PRIMARY FUNCTIONS
1. Acceptance of

deposits.
2. Advancing
loans.
3. Creation of
credit.
4. Clearing of
cheques.
5. Financing
foreign trade.
6. Remittance of
funds.

SECONDARY FUNCTIONS
1. Agency

Services.
2. General

Utility Services.

TOP RANKING COMMERCIAL

BANKS IN INDIA
1. STATE BANK OF INDIA
2. ICICI Bank Limited
3. Punjab National Bank
4. Canara Bank
5. Bank of Baroda
6. Bank of India
7. Union Bank of India
8. Industrial Development Bank of India Limited
9. Central Bank of India
10.HDFC Bank Limited
11.UCO Bank
12.Syndicate Bank
13.Indian Overseas Bank
14.Oriental Bank of Commerce
15.Allahabad Bank

CONCLUSION
Have been called upon to

help achieve certain socioeconomic objectives laid

down by the state.
Used to sub-serve the
national policy objectives of
reducing inequalities of
income and wealth, removal
of poverty and elimination
of unemployment in the
country.
In the modern world, banks
are to be considered not
merely as dealers in money
but also the leaders in
economic development.