Question

what is banking? give the main features of commercial banking.

Answer 1

Banking refers to the services that a bank provides which includes accepting deposits, lending funds, credit creation, etc. in order to earn profit.

A commercial bank refers to a financial institution that accepts deposits from the general public and extends loans for various purposes such as consumption and investment. it is engaged in a two way transaction. On one hand, it accepts deposits from the public and in return, it offers them a rate of interest on their deposits (borrowing rate for bank). On the other hand, it extends loans to the investors in return of which it charges a rate of interest on the amount lend (i.e. lending rate).

Answer 2

Bank is comes in tertiary or service sector it provides basic facilities to the persons.  People can fulfill their needs or basic necessities by taking loans from here (like home loan, vehicle loan, business loan, etc.)