Commercial banks/ Deposit banks Banks accept deposits from public and lend them mainly for commercial purposes for comparatively shorter periods are called Commercial Banks. They provide services to the overall public, organisations and to the corporate community.
They are oldest banking establishment within the unionised sector. Commercial banks create their profits by taking little, short-term, relatively liquid deposits and transforming these into larger, longer maturity loans. This method of quality transformation generates net profit for the banking concern. Many business banks do investment banking business though the latter isn't thought-about the most business space. The business industry consists of regular banks (registered within the second schedule of RBI) and non regular banks.
Features of Commercial banks
1. Lend funds to organisations, trade, commerce, industry, small business, agriculture etc.
2. They accepts deposits on various accounts.
3. They perform many innovative services to the customers.
4. The perform many subsidiary services to the customer.
5. They are the manufacturers of money.
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