Coupon Accepted Successfully!


Meaning of banking

According to the Banking Companies Act, 1949, banking has been defined as “accepting for the purpose of lending or investment, deposits of money from the public, payable on demand or otherwise and withdraw able by cheques, drafts, order or otherwise.”
Thus, banks act as a link between investors and savers. The idle resources of the community are channelized in productive avenues. Banks also add to the money supply of the economy by credit creation. Hence, it is used as an instrument of monetary policy.
There are many types of banks, like industrial banks, agricultural banks, exchange banks, commercial banks, etc. The ones we generally refer to are commercial banks. They perform all forms of banking businesses and deal in financial trade and commerce.

Test Your Skills Now!
Take a Quiz now
Reviewer Name