What Are The Advantages Of Unit Banking?
Answers
Advantages of Unit Banking: Unit banking system has the following advantages: 1. Easy Management: The management and control of unit banks is much easier and effective due to the small size and operations of the banks. There are less chances of fraud and irregularities in the financial management of the unit banks.
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Unit banking is a system of banking that has just one office with virtually no branches.
Unit banking is a system where an independent isolated bank undertakes banking functions in a particular area.
The unit banking system originated and developed in the USA under the patronage of the government.
Main advantages of unit banking:
A) Easy management and control: The management and control of unit banks are much easier and effective due to the small size and operations of the banks.
B) Quick Decision: In this system, there is an on the spot decision making by the bank management because there is no necessity of any consultation and approvals from external authority.
C) Personalised Services: A unit bank has personal knowledge of each of his customers and thus can provide personalized services.
D) No inefficient branches: In this system, inefficient loss-making banks are automatically eliminated, and only the profit earning banks survive. There is no system of providing protection or compensate for the losses of inefficient banks.
E) Local Utilisation of deposits: In unit banking system, there is no possibility of the transfer of resources by banks. The deposits mobilized by a unit bank in a particular are is utilized for the development of the same area. So, there is no chance for regional imbalances under this system. for more information: visit ;grammartrips.com