Commercial banking

This paper explains banks have played a critical role in the economic development of some developed countries such as Japan and Germany and most of the emerging economies including India. Banks today are important not just from the point of view of economic growth, but also financial stability. Bank has developed around 200 years ago. The natures of banks have changed the time has changed. The term bank is related to financial transactions. Banking is a financial institution that provides services, such as accepting deposits, giving business loan, auto loans, mortgage lending basic investment products like saving accounts and certificates of deposit.The commercial banking industry in India started in 1786 with the establishment of the bank of Bangal in Calcutta. Commercial banks in India have traditionally focused on meeting the short-term financial needs of industry, trade and agriculture. However, given the increasing sophistication and diversification of the Indian economy, the range of services extended by commercial banks has increased significantly, leading to an overlap with the functions performed by other financial institutions. The paper explains objectives, functions, and significance of commercial banking.