A commercial bank is an institution that provides services such as accepting deposits, providing business loans, and offering basic investment products. Commercial bank can also refer to a bank, or a division of a large bank, which specifically deals with deposits and loan services provided to corporations or large/middle-sized business.

Main definitions given by economists :

1. According to Oxford dictionary, “A commercial bank is that financial institution which accepts deposits from the people and offers loans for the purpose of consumption or investment.”
2. According to the Indian Banking Companies Act, 1949, “Banking companies are the ones which transact the business of banking which means the accepting of deposits of money from the public repayable on demand or otherwise and withdrawal by cheque, draft, order or otherwise”.
3. According to the Findlay Shirras, “Banker is an individual, firm or company who has place for doing the business where the money or currency is deposited, and through this deposited money or currency, the function of credit is performed and the deposited money are paid either by draft, cheque or order”.
4. According to Crowther, “Commercial bank is an institution which collects money deposits from those who have it in spare or who are saving it out of their income, and lend this money out to those who need it”.

Functions of commercial banks are broadly classified into three categories :

1. Primary functions
2. Agency-related function
3. General utility functions

1. Primary or main functions : Commercial banks perform two primary functions : 

(a) Accepting deposits : Accepting deposits from- the public is the most important function of a bank. Customers deposit their savings in the saving account and banks pay interest on sayings. To attract deposits of public, bank offer different types of accounts. 

These are :

1. Savings Account
2. Fixed Deposit Account
3. Current Account
4. Recurring Deposit Account
5. Pradhan Mantri Jan-Dhan Yojana Account

(b) Advancing loans : Another important function of bank is advancing of loans. Banks provide loan facility to its regular customers. Bank grants loans mainly for the construction of house, education, marriage, purchase of vehicle, etc. 

Banks provide loans in the following ways:

1. Loans or Advances
2. Cash credit
3. Overdraft
4. Discounting the bills of exchange.

2. Agency-related functions : Banks also perform agency functions for and on behalf of their customers. Customers have to give the bank in writing for these services. Some services that are performed by the bank are free of cost, and for some services, banks charge an amount of fees. 

Following are the works performed by the bank as an agency :

1. Cheque bill collection
2. Cheque bill payment
3. Payment from customers .
4. Receipts from customers
5. Sale and purchase of foreign securities
6. Transfer of payments
7. Working as a trustee.

3. General Utility Functions : Modern banks also perform additional tasks along with formal functions which are as follows :

1. Providing locker facility
2. Foreign exchange facility
3. Traveller cheque facility
4. Creation of credit
5. Arrangement of public loans
6. Collection and publication of information
7. Credit card facility
8. ATM facility
9. Internet banking facility
10. Mobile banking facility.