Which of the following is not a primary function of a bank? (2024)

FAQs

Which of the following is not a primary function of a bank? ›

Facilitating import of goods is not a primary function of a bank.

The correct answer is: c) they are responsible for the conduct of monetary policy. Other than the central authority of the country, which is called a central bank, banks do not apply monetary policy.

All banks have to perform two major primary functions namely: Accepting of deposits. Granting of loans and advances.

Final answer:

Transporting money is not a function of a banking system; this task is typically carried out by specialized security firms. Banks are involved in offering loans and accounts that facilitate transactions and reduce the need to carry cash.

One of the primary functions of a commercial bank is making advances, which allows customers to borrow money (loans, overdrafts, mortgages, credit cards). using customer deposits.

Answer and Explanation:

The price mechanism is not a function of money. It is a system for setting the prices of goods and services through the interactions between sellers and buyers. Money has three main functions, and these include store of value, medium of exchange, and unit of account.

Answer and Explanation:

A payday lender is not a bank. Short-term borrowing is characterized by a high interest rate where the lender provides loans to the borrower. It helps to cover immediate cash needs until we get our paycheck.

The RBI does not accept deposits or lend money to the public. It acts as banker and advisor to the government and other commercial banks.

A primary bank account also refers to the main account of operation of a banking customer. This is usually the account where purchase transactions, fees and charges connected to the ATM/Debit Card are debited.

Which of the following is not a function of a commercial bank? ›

Solution: Issuing currency is not the function of commercial banks. The main function of the Reserve Bank of India is to issue currency. A commercial bank is a financial institution that carries out all the operations regarding deposits, withdrawal of money, loans, and other activities.

Answer: The primary functions of a commercial bank are accepting deposits and also lending funds. Deposits are savings, current, or time deposits. Also, a commercial bank lends funds to its customers in the form of loans and advances, cash credit, overdraft and discounting of bills, etc.

Banks are mainly focused on providing retail banking products and services, while non-banking financial institutions offer a wider range of products and services, including corporate banking, investment banking, and private banking.

It is largely a division of a large bank which deals with loan and deposit services provided to large and small size businesses. Thus, there are many functions of commercial banks in India. Mainly there are two functions, primary and secondary.

The two essential functions of banks in the economy are accepting deposits and granting advances or lending loans. Banks collect deposits from the public in the form of savings deposits, fixed deposits, current deposits, and recurring deposits. This function is important because people earn interest from some deposits.

What are the four main functions of banks today? storing money, transferring money, lending money, and financial services.

Answer and Explanation: Private loans and leases are functions of commercial banks or finance companies, but not investment banks.