What is Banking

Bank definition:

A corporation empowered to deal with cash, domestic and foreign, and to receive the deposits of money and to loan those monies to third-parties.

A bank is an institution, usually incorporated with power to issue its promissory notes intended to circulate as money (known as bank notes); or to receive the money of others on general deposit, to form a joint fund that shall be used by the institution, for its own benefit, for one or more of the purposes of making temporary loans and discounts; of dealing in notes, foreign and domestic bills of exchange, coin, bullion, credits, and the remission of money; or with both these powers, and with the privileges, in addition to these basic powers, of receiving special deposits and making collections for the holders of negotiable paper, if the institution sees fit to engage in such business."

"The bank undertakes to receive money and to collect bills for its customer's account. The proceeds so received are not to be held in trust for the customer, but the bank borrows the proceeds and undertakes to repay them. The promise to repay is to repay at the branch of the bank where the account is kept, and during banking hours. It includes a promise to repay any part of the amount due against the written order of the customer addressed to the bank at the branch..... bankers never do make a payment to a customer in respect of a current account except upon demand."

"... a company which caries on as its principal business the accepting of deposits of money on current account or otherwise, subject to withdrawal by cheque, draft or order...."

Receiving money on deposit from its customers;

Paying a customer's cheques or drafts on it to the amount on deposit by such customers, and holding Dominion Government and bank notes and coin for such purpose;

Paying interest by agreement on deposits;

Discounting commercial paper for its customers;

Dealing in exchange and in gold and silver coin and bullion;

Collecting notes and drafts deposited;

Arranging credits for itself with banks in other towns, cities and countries;

Selling its drafts or cheques on other banks and banking correspondents;

Issuing letters of credit;

Lending money to its customers on the customers' notes, by way of overdraft (or) on bonds, shares and other securities