What is a Bank ? Introduction ↓
Finance is the life blood of trade, commerce together with industry. Now-a-days, banking sector acts every bit the backbone of modern business. Development of whatsoever province mainly depends upon the banking system.
The term depository fiscal establishment is either derived from one-time Italian give-and-take banca or from a French give-and-take banque both hateful a Bench or money telephone substitution table. In olden days, European money lenders or money changers used to display (show) coins of unlike countries inwards big heaps (quantity) on benches or tables for the purpose of lending or exchanging.
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A depository fiscal establishment is a fiscal establishment which deals alongside deposits together with advances together with other related services. It receives money from those who desire to relieve inwards the shape of deposits together with it lends money to those who necessitate it.
Definition of a Bank ↓
Oxford Dictionary defines a depository fiscal establishment every bit "an establishment for custody of money, which it pays out on customer's order."
Characteristics / Features of a Bank ↓
1. Dealing inwards Money
Bank is a fiscal establishment which deals alongside other people's money i.e. money given past times depositors.
2. Individual / Firm / Company
A depository fiscal establishment may live on a person, trouble solid or a company. Influenza A virus subtype H5N1 banking companionship way a companionship which is inwards the trouble organisation of banking.
3. Acceptance of Deposit
A depository fiscal establishment accepts money from the people inwards the shape of deposits which are normally repayable on need or later the overstep away of a fixed period. It gives security to the deposits of its customers. It every bit good acts every bit a custodian of funds of its customers.
4. Giving Advances
A depository fiscal establishment lends out money inwards the shape of loans to those who require it for unlike purposes.
5. Payment together with Withdrawal
A depository fiscal establishment provides tardily payment together with withdrawal facility to its customers inwards the shape of cheques together with drafts, It every bit good brings depository fiscal establishment money inwards circulation. This money is inwards the shape of cheques, drafts, etc.
6. Agency together with Utility Services
A depository fiscal establishment provides diverse banking facilities to its customers. They include full general utility services together with agency services.
7. Profit together with Service Orientation
A depository fiscal establishment is a lucre seeking establishment having service oriented approach.
8. Ever increasing Functions
Banking is an evolutionary concept. There is continuous expansion together with diversification every bit regards the functions, services together with activities of a bank.
9. Connecting Link
A depository fiscal establishment acts every bit a connecting link betwixt borrowers together with lenders of money. Banks collect money from those who stimulate got surplus money together with rank the same to those who are inwards necessitate of money.
10. Banking Business
A bank's top dog activeness should live on to create trouble organisation of banking which should non live on subsidiary to whatsoever other business.
11. Name Identity
A depository fiscal establishment should ever add together the give-and-take "bank" to its advert to enable people to know that it is a depository fiscal establishment together with that it is dealing inwards money.
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