ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Although banks do many things, their primary role is to take in funds-called deposits-from those with money, pool them, and lend them to those who need funds. Banks are intermediaries between depositors (who lend money to the bank) and borrowers (to whom the bank lends money).

Detailed explanation-2: -Functions of Commercial Banks:-Primary functions include accepting deposits, granting loans, advances, cash, credit, overdraft and discounting of bills.-Secondary functions include issuing letter of credit, undertaking safe custody of valuables, providing consumer finance, educational loans, etc.

Detailed explanation-3: -Commercial banks: Commercial banks are the financial organizations that receive deposits, provide security to the account, and give loans. Retail banks: A retail bank is a bank that only lends help to small businesses and companies and consumers.

Detailed explanation-4: -Bank loans are frequently used to finance start-up capital and also for larger, long-term purchases.