Importance of Banks in the Development of A Country
Banks are one of the most important part of any country. In this modern time money and its necessity is very important. A developed financial system of the country ensure to attain development. A modern bank provides valuable services to a country. To attain development there should be a good developed financial system to support not only the economic but also the society. So, a modern bank plays a vital role in the socio economic matters of the country. Some of the important role of banks in the development of a country are briefly mentioned below.
I- Promote Saving Habits Among People
Bank attracts depositors by introducing attractive deposit schemes and providing rewards or return in the form of interest. Banks providing different kinds of deposit schemes to its customers. It enable to create banking habits or saving habits among people.
II- Capital Formation and Promoting of Industries
Capital is one of the most important part of any business or industry. It is the life blood of business. Banks are increase capital formation by collecting deposits from depositors and converts these deposits in to loans advances to industries.
III- Easiness of Trade and Commerce Functions
In this modern era trade and commerce plays vital role between any countries. So, the money transaction should be user friendly. A modern bank helps its customers to sent funds to anywhere and receive funds from any where of the world. A well developed banking system provides various attractive services like mobile banking, internet banking, debit cards, credit cards etc. these kind of services fast and smooth the transactions. So, bank helps to develop trade and commerce.
IV- Generate Employment Opportunities
Since a bank promote industry and investment, there automatically generate employment opportunity. So, a bank enables an economy to generate employment opportunity.
V- Promote Agricultural Development
Agricultural sector is one of the integral part of any economy. Food self sufficiency is the major challenge and goal of any country. Modern bank promote agricultural sector by providing loans and advances with low rate of interest compared to other loans and advances schemes.
VI- Implementation of Monitory Policy
Monitory policy is a important policy of any government. The major aim of monitory policy is to stabilize financial system of the country from the dangerous of inflation, deflation, crisis etc.
VII- Balanced Development
Modern banks spreading its operations throughout the world. we can see number of big banks like citi bank, Baroda bank etc. It helps a country to spread banking activities in rural and semi urban areas. With the spreading of banking operations around the country, helps to attain balanced development by promoting rural areas.
Modern bank plays vital role in the socio- economic development of the country. A developed banking system enables the country to attain balanced development without any special consideration of rich and poor, cities and rural areas etc.