Question

Distinguish between the following:
Commercial bank & Central bank

Answer 1

Basis of Difference	Commercial Bank	Central Bank
Objective	The main objective of a commercial bank is to make profits.	The main objective of the central bank is to regulate and control the functioning of other banks.
Issue of notes	It cannot issue currency notes and coins.	It has the exclusive right to issue currency notes and coins.
Deposits	It accepts deposits from the general public.	It does not accept deposits from the general public.
Public dealings	It directly deals with the general public.	It does not directly deal with the general public.
Ownership	It can be owned by private players or the Government.	There is only one central bank in India, i.e., RBI.
Number	There are many commercial banks in India.	There is only one central bank in India, i.e., RBI.
Monetary Policy	The commercial banks do not frame any monetary policy.	The Central bank frames the monetary policy and credit policy.
Monitoring	The commercial bank does not keep check on the Central bank.	The Central bank keeps a check on the working of the commercial banks.
Printing of currency	The commercial bank cannot print currency notes.	The central bank can print currency notes.
Function	The main function is to accept deposits from public for lending to industry and others.	The main function of the central bank (RBI) is to regulate money supply in the country.