Revision: Foundations of Business >> Business Services Business Studies Commerce (English Medium) Class 11 CBSE

Bank is a financial institution which accept deposit in different form from the public and provides loans and advances to the industrialists, traders, businessmen and needy people.

According to Banking Regulation Act 1949, Bank is defined as "accepting for the purpose of lending or investment of deposits of money from public, repayable on demand or otherwise and withdrawable by cheque, draft and order or otherwise."

“Ordinary banking business consists of changing cash for bank deposit and bank deposit for cash, transferring bank deposit from one person to another, giving bank deposit in exchange for government bonds, the recurring promises of businessmen to repay and so forth.” — Prof. Sayer’s

Life insurance is a contract under which the insurance company (called the insurer) agrees to pay the specified amount (called sum assured) on the death of the insured person or upon the expiry of a specified period, whichever is earlier, in consideration of the regular premium. Life insurance is the most popular form of insurance because it plays a vital role in the lives of the public.

Fire insurance is a contract under which the insurance company (insurer) agrees to identify the insured in return for the premium against damage or loss. To property caused by fire during an agreed period of time and up to a specified amount. A fire insurance policy provides protection against damage or loss to property, i.e., buildings, furniture, goods, etc., caused by fire.

Marine insurance is one of the oldest types of insurance. It plays a vital role in foreign trade by providing protection against the perils of the sea. Sea perils include piracy, collision, capture by the enemy, seizure, restraint, jettison, barrage, etc. Jettison means throwing goods overboard in order to avoid sinking a ship, while barratry refers to a fraudulent breach of duty by a master or staff of the ship. Sinking the ship after being hit by a rock and loss of cargo due to seawater or heat are other examples of sea perils. Thus, marine insurance may be defined as a contract whereby the insurer agrees to indemnify the insured in a manner and to the extent agreed upon against marine losses.

Fire insurance is a contract under which the insurance company (insurer) agrees to identify the insured in return for the premium against damage or loss. To property caused by fire during an agreed period of time and up to a specified amount. A fire insurance policy provides protection against damage or loss to property, i.e., buildings, furniture, goods, etc., caused by fire.

Marine insurance is one of the oldest types of insurance. It plays a vital role in foreign trade by providing protection against the perils of the sea. Sea perils include piracy, collision, capture by the enemy, seizure, restraint, jettison, barrage, etc. Jettison means throwing goods overboard in order to avoid sinking a ship, while barratry refers to a fraudulent breach of duty by a master or staff of the ship. Sinking the ship after being hit by a rock and loss of cargo due to seawater or heat are other examples of sea perils. Thus, marine insurance may be defined as a contract whereby the insurer agrees to indemnify the insured in a manner and to the extent agreed upon against marine losses.

Life insurance is a contract under which the insurance company (called the insurer) agrees to pay the specified amount (called sum assured) on the death of the insured person or upon the expiry of a specified period, whichever is earlier, in consideration of the regular premium. Life insurance is the most popular form of insurance because it plays a vital role in the lives of the public.

Fire insurance is a contract under which the insurance company (insurer) agrees to identify the insured in return for the premium against damage or loss. To property caused by fire during an agreed period of time and up to a specified amount. A fire insurance policy provides protection against damage or loss to property, i.e., buildings, furniture, goods, etc., caused by fire.

Life insurance is a contract under which the insurance company (called the insurer) agrees to pay the specified amount (called sum assured) on the death of the insured person or upon the expiry of a specified period, whichever is earlier, in consideration of the regular premium. Life insurance is the most popular form of insurance because it plays a vital role in the lives of the public.

Marine insurance is one of the oldest types of insurance. It plays a vital role in foreign trade by providing protection against the perils of the sea. Sea perils include piracy, collision, capture by the enemy, seizure, restraint, jettison, barrage, etc. Jettison means throwing goods overboard in order to avoid sinking a ship, while barratry refers to a fraudulent breach of duty by a master or staff of the ship. Sinking the ship after being hit by a rock and loss of cargo due to seawater or heat are other examples of sea perils. Thus, marine insurance may be defined as a contract whereby the insurer agrees to indemnify the insured in a manner and to the extent agreed upon against marine losses.

Communication is the process of transmitting information from one place to another through a medium.

Transport is the movement of people, animals and things from one place to another.

• Accept Deposits – Main source of funds: Demand Deposits (Current/Savings Accounts) & Time Deposits (Fixed/Recurring Deposits)
• Grant Loans & Advances – Cash Credit, Overdraft, Term Loans, Bill Discounting (banks profit from interest spread)
• Cheque System – Safe payment method using cheques (principal business payment tool)
• Transfer of Funds – Fast/safe money transfer via drafts, pay orders, mail/telegraphic transfers (essential for commerce)
• Credit Creation – Banks multiply money: loans create new deposits (Initial Deposit × 1/CRR formula)
• Financing Trade – Bill discounting + short-term trade loans (facilitates internal/external trade)
• Foreign Exchange & Utility Services – Currency exchange + lockers, travel cheques, mobile banking, agency functions