HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank. A commercial bank is an institution that provides services such as accepting deposits, providing business loans, and offering basic investment products. A commercial bank can also refer to a bank, or a division of a large bank, which more specifically deals with deposit and loan services provided to corporations or large/middle-sized business – as opposed to individual members of the public/small business.

HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

The general role of commercial banks is to provide financial services to general public, business, and companies, ensuring economic and social stability and sustainable growth of the economy. In this respect, “credit creation” is the most significant function of commercial banks. While sanctioning a loan to a customer, they do not provide cash to the borrower. Instead, they open a deposit account from which the borrower can withdraw. In other words, while sanctioning a loan, they automatically create deposits, known as a “credit creation from commercial banks”.

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HSC Finance, Banking, and Bima 2nd Paper 3rd Chapter Note Commercial Bank

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