COMMERCIAL BANKS are privately owned banks which are established to undertake ordinary banking transactions for the general public. Although, they are profit oriented.
FUNCTIONS:
- Acceptance of deposits
- Granting of loans to customers.
- Discounting bills of exchange
- Acts as agents of payment or transfer of money on behalf of its customers.
- Financing of foreign trade.
- Financing of industries for their development.
- Offers financial advice to customers.
- Safe-keeping of valuable items.
- Acts as Trustees.
- Issues travelers cheques.
COMMERCIAL BANK AND THEIR IMPORTANCE TO ECONOMIC DEVELOPMENT
The commercial banks also play prominent role in the development of the economy of a country through the following ways:
- Stimulating savings and investments thereby removing capital deficiency.
- Making provision for availability of credit facilities for financial priority sectors.
- Making provision for optimum utilization of the financial resources of the community.
- Encouraging expansion of credit.
- Promotion of international trade