answersLogoWhite

0


Best Answer

central bank does not accept deposit from customers whiles commercial bank does.

central bank is responsible for issuing of currencies whiles commercial bank does not.

central bank is accountable to the government whiles commercial bank is accountable to the share holders.

central bank is not set up for profit but commercial bank is set up for profit.

central bank is governed by an act of parliament whiles commercial bank is set up by an incorporation.

central bank formulate monetary policies whiles commercial bank does not.

User Avatar

Wiki User

14y ago
This answer is:
User Avatar
More answers
User Avatar

Wiki User

11y ago

There are certain basic differences between a central bank and a commercial bank. They are:

(i) The central bank is the apex monetary institution, which has been specially empowered to exercise control over the banking system of the country. The commercial bank, on the contrary, is a constituent unit of the banking system.

(ii) The central bank does not operate with a profit motive. The primary aim of the central bank is to achieve the objectives of the economic policy of the government and maximise the public welfare through monetary measures. The commercial banks, on the other hand, have profit earning as their primary objective.

(iii) The central bank is generally a state-owned institution, while the commercial banks are normally privately owned institutions.

(jv) The central bank does not deal directly with the Public. The commercial banks, on the contrary, directly deal with the public.

(v) The central bank does not compete with the commercial banks. Rather it helps them by acting as the lender of the last resort.

(vi) The central bank has the monopoly of note-issue, whereas the commercial banks do not enjoy such right.

(vii) The central bank is the custodian of the foreign exchange reserves of the country. The commercial banks are only the dealers in foreign exchange.

(viii) The central bank acts as the banker to the government, the commercial banks act as bankers to the general public.

(ix) The central bank acts as the bankers' bank : (a) The commercial banks arc required to keep a certain proportion of their reserves with central bank ; (b) the central bank helps them at the time of emergency ; and (c) the central bank acts as the clearing house for the commercial banks. But, the Commercial banks perform no such function.

This answer is:
User Avatar

User Avatar

Wiki User

15y ago

commercial banks like bananas and central banks dont.

This answer is:
User Avatar

User Avatar

Wiki User

10y ago

The functions of the central bank are two oversee commercial banks and other financial organizations. Commercial banks deal directly with the general public

This answer is:
User Avatar

User Avatar

Wiki User

12y ago

in commercial banks we have profits

This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: Differences between functions of the central bank and commercial bank?
Write your answer...
Submit
Still have questions?
magnify glass
imp
Related questions

What are functions of central bank India?

to provide loan to customers and other commercial banks. to check the functioning of commercial banks.


What are the major political differences between western and central Europe?

revved DVDs


What is the primary differences between a federal government and a confederation?

in a federal government, the power is divided between the central and local governments.


What were the differences between workforces of the central and union pacific?

the chinese need it


Distinguish between mercantilism and cameralism?

The differences between mercantilism and cameralism are highlighted by the varying political realities in Western and Central Europe.


What are the 2 differences between an animal cell and a plant cell?

cell wall, central vacuole, and chloroplasts


What were the similarities and differences between the Central Powers and Allies?

Allies and central powers are so kool and if u dont know then u are so stupid!!!! :) LOSER!!!!


What are the functions of central canal?

what is the function for central canal


Differences between the nervous system and the central nervous system?

The nervous system is all parts of the system while the Central Nervous system is composed of the brain and the spinal cord which contains your central nerves.


What does ir al central commercial mean in English?

Ir al central commercial is Spanish for "go to the mall".


When was Iloilo Central Commercial High School created?

Iloilo Central Commercial High School was created in 1912.


What is the part of speech of central idea?

"Central idea" functions as a noun.