Asset Liabilty Management
What is a Bank ? Introduction, Definition and Features of Bank
Post : Gaurav Akrani Date : 2/09/2011 10:15:00 AM IST
Comments (4) Labels : Banking
What is a Bank ? Introduction ↓
Finance is the life blood of trade, commerce and industry. Now-a-days, banking sector acts as the backbone of modern business. Development of any country mainly depends upon the banking system.
The term bank is either derived from old Italian word banca or from a French word banque both mean a Bench or money exchange table. In olden days, European money lenders or money changers used to display (show) coins of different countries in big heaps (quantity) on benches or tables for the purpose of lending or exchanging.
Image Credits © Tardiskey
A bank is a financial institution which deals with deposits and advances and other related services. It receives money from those who want to save in the form of deposits and it lends money to those who need it.
Definition of a Bank ↓
Oxford Dictionary defines a bank as "an establishment for custody of money, which it pays out on customer's order."
Characteristics / Features of a Bank ↓
1. Dealing in Money
Bank is a financial institution which deals with other people's money i.e. money given by depositors.
2. Individual / Firm / Company
A bank may be a person, firm or a company. A banking company means a company which is in the business of banking.
3. Acceptance of Deposit
A bank accepts money from the people in the form of deposits which are usually repayable on demand or after the expiry of a fixed period. It gives safety to the deposits of its customers. It also acts as a custodian of funds of its customers.
4. Giving Advances
A bank lends out money in the form of loans to those who require it for different purposes.
5. Payment and Withdrawal
A bank provides easy payment and withdrawal facility to its customers in the form of cheques and drafts, It also brings bank money in circulation.
Post : Gaurav Akrani Date : 2/09/2011 10:15:00 AM IST
Comments (4) Labels : Banking
What is a Bank ? Introduction ↓
Finance is the life blood of trade, commerce and industry. Now-a-days, banking sector acts as the backbone of modern business. Development of any country mainly depends upon the banking system.
The term bank is either derived from old Italian word banca or from a French word banque both mean a Bench or money exchange table. In olden days, European money lenders or money changers used to display (show) coins of different countries in big heaps (quantity) on benches or tables for the purpose of lending or exchanging.
Image Credits © Tardiskey
A bank is a financial institution which deals with deposits and advances and other related services. It receives money from those who want to save in the form of deposits and it lends money to those who need it.
Definition of a Bank ↓
Oxford Dictionary defines a bank as "an establishment for custody of money, which it pays out on customer's order."
Characteristics / Features of a Bank ↓
1. Dealing in Money
Bank is a financial institution which deals with other people's money i.e. money given by depositors.
2. Individual / Firm / Company
A bank may be a person, firm or a company. A banking company means a company which is in the business of banking.
3. Acceptance of Deposit
A bank accepts money from the people in the form of deposits which are usually repayable on demand or after the expiry of a fixed period. It gives safety to the deposits of its customers. It also acts as a custodian of funds of its customers.
4. Giving Advances
A bank lends out money in the form of loans to those who require it for different purposes.
5. Payment and Withdrawal
A bank provides easy payment and withdrawal facility to its customers in the form of cheques and drafts, It also brings bank money in circulation.