What is a Commercial Bank? - Explained

What is a Commercial Bank



Define a Commercial Bank

Commercial Bank is an organization which is regulated and which delivers service or service at a service fee or charge a percentage interest from you for the type of monetary service that they are providing. Unlike every other organization which strive to make profits, the commercial banks are selling or promoting a you a product or service of them which they can customize according to your requirement and your or your business eligibility criteria to allow you to subscribe.

As an example if you go to a telecommunication service provider and request for a package that suite you, And you do have a requirement to meet by purchasing or subscribing to a telecommunication product which is you need to get an internet data package of 2GB with a new iPhone. And when you walk into the store and tell your requirement you can get a new iPhone 6 Plus with a 2GB data plan with a contract period of 2 years which goes at 70USD per month. Or you can get the iPhone 6 Plus at a price of 700USD One time Payment with a 2GB data plan without a contract period for 12USD per month. So you can choose what you want and how you need to pay for it. If you buy the contract period of 70USD per month you won't need to pay 712USD on the first month and if you don't want to get into a contract period that means you needs to pay 712USD up front and get the product.

In Banking it's the same. You can choose whether you need to borrow some amount of cash or you need to get the best rate for your savings or anything depending on your requirement. And that's what Commercial Banks does for you when you are searching for a solution that you need.

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