It can be seen that the bank's business, on the one hand, concentrates idle monetary funds and small monetary savings in society by absorbing deposits, and then lends them to people who need to replenish money in the form of loans; Here, banks act as intermediaries between lenders and borrowers.
On the other hand, banks handle the payment and settlement of money for commodity producers and businessmen, and also act as payment intermediaries. In short, banks play the role of credit intermediaries.
The basic functions of commercial banks include: credit intermediary, payment intermediary, credit creation and financial services.
Extended data
Functions of banks
1, credit intermediary function.
Credit intermediary is the most basic function of commercial banks, which can best reflect the characteristics of their business activities. The essence of this function is to concentrate all kinds of idle money in the society in the bank through the debt business of the bank, and then invest it in various economic sectors through the asset business; As the intermediary or representative of both borrowers and lenders of monetary funds, commercial banks realize the financing and obtain interest income from the difference between the cost of absorbing funds and the interest income of loans and investment income, thus forming bank profits.
Commercial banks have become "big businessmen" buying and selling "capital goods". Commercial banks realize financing between capital surplus and deficiency through the function of credit intermediary, without changing the ownership of monetary capital, but only the right to use it.
2. Payment intermediary function.
Commercial banks not only act as credit intermediaries and finance monetary funds, but also perform monetary management functions. Through the transfer of deposits in the account, the function of agent customer payment and deposit business. Through the transfer of deposits in the account, we pay on behalf of customers, depositors, tellers and payment agents Taking commercial banks as the center, a payment chain and the relationship between creditor's rights and debts with no beginning and no end are formed in the economic process.
Refer to Baidu Encyclopedia-Bank