Commercial Banks

Accepting deposits, Advancing loans, Providing locker facilities, Transfer of funds

Commercial banks perform primary functions (accepting deposits, advancing loans), agency functions (transfer of funds), and general utility functions (locker facilities). Only the central bank issues currency.

True

True. Commercial banks mobilize public savings by collecting deposits from people who have surplus money and providing security. This helps in channeling idle money into productive uses.

Collection of insurance premiums, Purchase and sale of securities, Transfer of funds, Acting as trustee

Agency functions are services banks provide on behalf of customers like collecting premiums, buying/selling securities, transferring funds, and acting as trustees. Accepting deposits is a primary function.

Generating new money through lending activities

Credit creation refers to banks generating new money through lending. When banks grant loans, they create demand deposits (secondary deposits), thus increasing money supply in the economy.