Introduction:
A bank is a company which deals in money for the purpose of earning profit.It collects money from those who have it spare and lends to those who need it. The bank pays interest on deposits and receives interest on loans and advances. Bank not only provides funds to the businessmen but also gives valuable business information to them. Bank also provides safe custody services to its customers against rent. The bank deals in foreign exchange. It shifts money from one place to another place for customers. Banks also promote international trade with the help of letter of credit. A legal framework has been designed for regulation and supervision of banking business. This regulatory process is basically maintained by the state bank.
Definitions:
Crowther says:
"A bank is a firm which collects money from those who have it spare. It lends money to those who require it."
J.M.Gilbert says:
"A banker is a dealer in capital or more properly a dealer in money. He is an intermediate party between borrower and the lender. He borrows from one party and lends to another."
Mr.Kinly says:
"A bank is an institution which receives deposits and advances loans."
Professor Kent says:
"An organization whose principal operation are concerned with the accumulation of the temporarily idle money of the general public for the purpose of advancing to others for expenditures."
Mr.Parking Says:
"A bank is a firm that takes deposits from households and firms and make loans to other households and firms."
Banking Companies Ordinance 1962 Pakistan states:
"Banking means the accepting, for the purpose of lending or investment, of deposit of money from the public, repayable on demand or otherwise,and withdraw able by cheque, draft and order to otherwise"and Banking company means any company which transacts the business of banking in Pakistan."
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