Banking institutions have a number of basic functions. In recent years these have evolved to serve the changing needs of consumers. Understanding the most modern functions of a commercial bank can help in terms of figuring out the best ways to make use of services.
At a basic level, banks receive deposits, invest funds and lend money.
By using the money that has been deposited by customers to loan to other customers for a profit, commercial banks provide a vital service for the economy.
Banks may also invest funds on behalf of customers.
In light of the digital revolution that has taken over the banking world, the modern functions of a commercial bank have transformed quite significantly.
EMV technology involves the use of a microprocessor chip to encrypt transaction information. Customers can rely on much safer banking options.
As more individuals begin to embrace smart devices such as smart watches, banks have had to keep up with the changes in the way that people are choosing to transact. The demand for wrist watch applications is set to soar in coming years.
Banks also need to have the ability to compete with tech companies such as PayPal, Amazon and Google. As more people use these payment methods to bypass high bank charges, these institutions are being forced to find ways to compete.
Advances in customer analytics continue to be made, which make it easier for banks to understand the needs of their customers and to adapt their service offering in order to provide the best services.
Modern functions of a commercial bank include:
- Money Transfers
- Cellphone banking
- Online banking
- Various tools at ATM facilities
- More advanced and digitally connected network
- Additional financial services like insurance
- Easily accessible investment accounts
Banks need to do what it takes to keep up with the changes that are affecting the sector at all times.