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Answer» Meaning of a Bank: - A bank is an institution authorised to collect peoples’ deposits with the purpose of lending those under the condition of returning the same when the depositor demands.
- A bank is a commercial organization functioning for profit.
- A bank accepts peoples’ deposits and pays interest in return.
- A bank ensures the safety of these deposits and lends money from these deposits by charging interest and invests the surplus deposits in various sectors of economy for the development of the country.
- Banks are instrumental in mobilizing money. Where value of stock of money tends to ‘fall at a future date and value of circulating money tends to increase.
Classification (Types) of Banks: Banks are basically classified into two categories: - Commercial Bank and
- Central Bank.
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