What are the functions of sbi bank?

Answer 1

The State Bank of India acts as an agent of the ReserveBank of India and performs the following functions:

(1) Borrows money: The Bank borrows money from the public by accepting deposits such as current account deposits, fixed deposits and savings deposits.

(2) Lends money: It lends money to merchants and manufacturers for short periods. It also lends to farmers and co-operative institutions. It lends mostly on the security of easily realizable commodities like rice, wheat, cotton, oil-seeds, cloth, gold and government securities. The Bank can lend against agricultural bills up to a maximum period of fifteen months and in case of other bills up to a maximum period of six months.

(3) Banker's Bank: The State Bank of India acts as the banker's bank. In discharging this responsibility, the bank provides loans to commercial bank when required and also rediscount their bill. It also acts as the clearing house of the commercial bank.

(4) Government's Bank: The State Bank of India also acts as the agent of the Reserve Bank of India. As an agent, the State Bank of India maintains the treasuries of the State Government. The Bank also manages the debts floated by the State Governments.

(5) Remittance: The State Bank of India facilitates remittance of money from one place to another. It also helps in the transfer on the funds of the State and Central Government.

(6) Functions as Central Bank: The State Bank of India performs the functions of a Central Bank.

(7) Subsidiary functions: The State Bank performs various subsidiary services also. It collects checks, drafts, bill of exchange, dividends interest, salaries and pensions on behalf of its customers. It purchases and sells securities on behalf of its customer. It receives valuables and documents for safe custody and maintains safe deposit vaults.