Ever wondered about the importance of a bank when it comes to securing money and earning returns on it? This article may help to clarify your concepts for the same. A bank is a financial institution that accepts deposits and channels the money into lending activities. You can keep your money safe with a bank and even choose to earn profit on it. It offers services of lending to its clients by giving out loans, installment plans and unsecured loans like credit cards etc.  All banks function as a payment agent by enabling clients to make payments and transfers through telegraphic transfers, cheques, pay orders, demand drafts and so on. These services are not offered for free; a certain fee is levied upon customers for carrying out such transactions which is actually determined by the central bank or the state bank. All banks charge their customers differently according to their margin and on the basis of a customer’s worth. For instance, in some banks bank charges are waived for customers who hold a handsome deposit with the bank. These charges also vary from local to foreign banks. One can avoid these charges by handling their money smartly and intelligently and by choosing among different modes of making payments.

The concept of banking incorporates savings and investment. You can save your money and even double it by fixing your funds at a certain interest rate for a specified time period. When that period matures, you get back your principal amount along with the interest earned at maturity. On the bank’s side, it invests the same money by lending it further to other channels. This may include lending to businesses and individuals. For instance, banks act as agents for other companies in the process of issuing securities. In the banking business, not only investment is made for other companies but banks also advise companies on matters related to issue and placement of stocks.

Bank services have improved in modern times, with the introduction of online banking facility. In the initial years of banking people were restricted to carry out transactions with any one branch of a bank where they initially opened their account. Now, customers can access their account and carry out all transactions at any branch of the same bank. Here too, banks have different policies for charging their customers. For instance, many banks charge their customers for making a deposit or withdrawal of money at a branch other than their base branch while there are free online banks too which offer this facility at zero cost. This facility enables customers to access their accounts from any branch of the same bank within a country thus saving traveling cost and providing ease of access to their own money.

The history of banking contains purely manual banking with the use of journals, papers and primitive methods of maintaining data records. Technology advancements have brought new concepts and new ways of operations in almost all walks of life and, all sectors of business and industry. You can now access your account from home or at work by logging onto your bank’s site and availing the option of internet banking. You can check your account balance, make payments and transfers and forward account related requests and complaints through the Internet. More and more banks are extending their services online so as to attract more customers and facilitate them to the maximum. Distances have increased due to more and more traffic on the roads and people have less time to drive to their banks for the simplest of queries. Thus, people find it much easier to opt for internet banks which offer almost all the functions on their websites.

It is convenient to bank in your country of residence if the socio-economic and political situation is smooth but it is safer to bank in another country or region when there is uncertainty in your home country. Rapidly changing microeconomic conditions and fastly moving political scenarios have entailed a need of offshore banking which allows you to save your money yet provide full access to it through secure internet banking. You can open account with an offshore bank online without the hassle of signing papers and saving time and energy to be phyisically there yourself. You can also easily transfer money and make payments virtually with such a bank.

Banking industry has expanded in terms of advancement in technology and in terms of offering variety of new services and facilities thus enabling one to do so much more than just save the money with an insitution like bank.