Definition of Bank
A bank is a financial institution that collects deposits from the public and makes funds available to those who need them such as entrepreneurs, households, businessmen, government, etc., for the economic development of the country. Beside this, it also performs many other functions like credit creation, agency functions, general services, etc. Thus, in the modern marketing activities, a bank fulfills both long-term and short-term requirements of businessmen and general public.
The definition of “Banking” has been defined by many eminent scholars as under:
- Crowther: – “A commercial bank collects money from those who have it to spare or who are saving it out of their income and lends the money to those who require it.”
- Kingsley: – “A bank is the establishment which makes to individuals such advances of money as may be required and safely made and to which individuals entrust money when not required by them for use.”
- P. Kent: – “A bank is an organization whose principal operations are concerned with the accumulation of the temporarily idle money of the general public for the purpose of advancing to others for expenditure.”
- Cairncross: – “A bank is a financial intermediary, a dealer in loans and debts.”
- Banking Regulation Act, 1949: – “Banking is the business of accepting for the purpose of lending or investment of deposits from the public repayable on demand or otherwise and withdraw able by cheque, draft, order or otherwise.”
- Findlay Shriras: – “Bank is a person, firm or company having a place of business where credits are opened by deposits or collection of money or currency, where money is advanced or loaned.”
Here, the bank marketing is the sum up of functions, directed at providing services to satisfy customer’s financial needs and wants, more effectively and efficiently than the competitors keeping in view the organizational objectives of the bank. It is necessary to create and win more and more customers and to retain them through effective customer service.
Structure of banking system in India
These are those financial institutions that accept deposits from the people and give loans for the purpose of consumption or investment and contribute in accelerating the rate of economic development in underdeveloped and developing countries like India. According to Culbertson, “Commercial Banks are the institutions that make short term loans to business and in the process create money.”
According to Reed and Gill, “A commercial bank is a financial institution that accepts demand deposits and makes commercial loans and is regulated by a bank regulatory agency.” In India, there are following types of commercial banks:-