Question

Write Short Notes on.
General utility functions of commercial banks.

Answer 1

A commercial bank is a financial institution which accepts deposit from people and offers loans for the purpose of consumption or investment. Commercial banks perform general utility function by providing the following facilities to its customers:

• Issuing traveler cheque: A traveler's cheque is a medium of exchange that can be used in place of hard currency which is denominated in one of a number of major world currencies in fixed amount which is generally used by the people going on vacations to foreign countries.
• Offering a safe deposit vault: A safe deposit vault also know as a safe deposit box is an individual secured metal container held within a larger safe which is provided to all the bank account holders of all the banks who offers such services in order to keep their valuable things like accessories and important papers safely and securely with the bank.
• Issuing debit cards and credit cards which are electronic cards that can be used to withdraw money without going to the banks and also to make payments at the time of purchasing any goods and services.