A banking company means any company, which transacts the
business of banking. Banking means accepting for the purpose of lending of
investments of deposits of money from the public, payable on demand or otherwise and withdrawal by cheque, draft order or otherwise.
Types of bank
Saving bank
Saving banks are established to create a saving habit among
the people. These banks are helpful for salaried people and low-income groups.
The deposit collected from customers is invested in bonds, securities, etc.
Commercial bank
A commercial bank is a type of bank/financial institution
that provides services such as accepting deposits, making business loans, and
offering basic investment products. These banks collect money from general
public and give short-term loan to businessmen by way of cash credit, over
drafts etc. commercial bank provide various service like collecting cheques,
bill of exchange, remittance money from one place to another place.
Industrial bank or development bank
Such banks collect cash by issuing share and debentures and
providing long term loans to industries. The main objective of this bank is to
provide long-term loans for the expansion and modernization of industries.
Land development bank
Development banks are specialized financial institutions. They
provide medium and long-term finance to the industrial and agricultural sectors.
They provide finance to both the private and
public sectors. Development banks are multipurpose financial institutions. They do
term lending, investment in securities and other activities. They even promote
saving and investment habit in the public.
Indigenous bank
It means money lenders, ‘’ they collect deposits from the
general public and grant loans to the needy persons out of their own funds as
well as from deposits. These indigenous
banks are famous in the village and small town. They perform combined function
functions of trading and banking activities.
Cooperative bank
Cooperative banks are registered under cooperative societies
Act, 1912. They generally give credit facilities to small farmers, salaried
employees, small-scale industries, etc. cooperative banks are available in
rural as well as in urban areas.
Central / federal /
national bank
Every country of the world has a central bank. In India,
reserve bank of India, in USA federal reserve and in the UK, Bank of England. These
central banks are the bankers of the other banks. They provide specialized function,
issue of paper currency, working as bankers of government.
Exchange bank
Hong Kong bank, bank of Tokyo, Bank of America are the
example of foreign banks working in India. These banks are mainly concerned
with financing foreign trade.
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