WEEK/TERM: THIRD TERM/WEEK 4
DATE:
CLASS: JSS 1
SUBJECT: Business Studies.
TOPIC: Bank Services (commercial banks)
REFERENCE: Meybiks New Basic Business Studies
Brief explanation:
A bank is a financial institution where money and other valuables are kept for safety. Every businessman deals with money. Handling money is one important thing that a businessman should be careful about. It is not safe to carry money about or keep huge sum of money in our houses as it exposes one to a lot of dangers hence, it is necessary to keep money in the bank. There are different kinds of banks (e.g central bank, commercial bank, merchant bank etc) but in this lesson we are focusing on commercial banks
Notes for the pupils:
MEANING OF COMMERCIAL BANKS
Commercial banks are financial institutions which accept deposits and other valuables from individuals and groups, for safekeeping with the aim of making profit. The owners of commercial banks are called shareholders. Examples of commercial banks in Nigeria are; First Bank Plc, United Bank For Africa (UBA) Plc, Guaranty Trust Bank Plc, Diamond Bank Plc, Zenith Bank Plc, Keystone Bank etc.
SERVICES PROVIDED BY COMMERCIAL BANKS ARE LISTED BELOW FROM 1 TO 8
- Accepting deposits: This is the major function of commercial banks. They accept deposits from the public for safekeeping. Money is kept in form of fixed deposits, current account, and savings accounts. These deposits enable the commercial banks to make profits as they lend this money out for interest.
- Safe keeping of valuables: Banks keep valuables like wills, certificates, jewelries and other documents, for customers.
- Lending money to customers: Banks give out money as loans to individuals and organizations.
- Act as agent of payment: Banks act as agents of payment on behalf of their customers.
- Issuance of bank statements: Commercial banks prepare and send bank statements to their customers to show their transactions with them on daily or monthly basis.
- Tax collection: Banks help governments in collecting revenue like electricity bills, water bills and examination forms.
- Issuance of travellers‘ cheques: Banks issue cheques to overseas travellers to facilitate their commercial transactions outside the country.
- Provide financial advice: Commercial banks encourage and advise businessmen on the type of investments and projects to undertake.
ASSIGNMENT
- What is a commercial bank?
- Name five services rendered by commercial banks.
- Explain how a commercial bank makes profit.
- List five examples of commercial banks in Nigeria.