Commercial banks play a vital role in the financial system of any country, and Nigeria is no exception.
These institutions offer a wide range of services and products that help individuals, businesses, and other organizations manage their money and achieve their financial goals.
The Central Bank of Nigeria formulates the policies and keeps a track of the banking system in totality so that the operators comply with the monetary, FOREX, and credit guidelines.
In this post, we’ll explore the 24 functions of commercial banks in Nigeria, covering everything from accepting deposits and issuing debit and credit cards to providing loans and offering investment products.
Understanding the various functions of commercial banks can help you make informed decisions about your own financial management and take advantage of the services and products that are available to you.
1. Accepting deposits
Commercial banks accept deposits from individuals, businesses, and other organizations, which can be in the form of checking accounts, savings accounts, certificates of deposit, and other types of accounts.
2. Providing checking and savings accounts
Commercial banks offer a range of checking and savings account options to meet the needs of different customers, including accounts with no minimum balance requirements, accounts with high interest rates, and accounts with additional features such as online banking and mobile banking.
3. Issuing debit and credit cards
Commercial banks issue debit cards, which allow customers to make purchases and withdraw cash from their checking or savings accounts, and credit cards, which allow customers to borrow money to make purchases and pay back the borrowed amount over time with interest.
4. Providing loans
Commercial banks provide loans to individuals, businesses, and other organizations for a variety of purposes, such as financing the purchase of a home or car, starting or expanding a business, or paying for education.
5. Offering financial advice and planning services
Many commercial banks have financial advisors or planners on staff who can help customers plan for their financial future and make informed decisions about their money.
6. Providing foreign exchange services
Commercial banks often offer foreign exchange services, which allow customers to buy and sell different currencies.
7. Issuing checks
Commercial banks issue checks, which allow customers to make payments to other individuals or organizations.
8. Providing online and mobile banking services
Commercial banks offer online and mobile banking services, which allow customers to access their accounts, check their balances, make payments, and perform other banking tasks from their computer or mobile device.
9. Offering credit and debit card processing services
Commercial banks often provide credit and debit card processing services to businesses, which allow them to accept card payments from customers.
10. Providing wire transfer services
Commercial banks offer wire transfer services, which allow customers to send and receive money from one bank to another, either domestically or internationally.
11. Offering investment products
Many commercial banks offer investment products, such as mutual funds, stocks, and bonds, to help customers grow their wealth.
12. Providing insurance products
Commercial banks may also offer insurance products, such as life insurance, health insurance, and property and casualty insurance, to help customers protect themselves and their assets.
13. Offering safe deposit boxes
Commercial banks often provide safe deposit boxes, which allow customers to securely store valuables such as jewelry, documents, and other important items.
14. Providing cashier’s checks
Commercial banks issue cashier’s checks, which are a type of check that is guaranteed by the bank and can be used as a secure form of payment.
15. Providing notary services
Some commercial banks have notaries on staff who can notarize documents, which is a process that confirms the authenticity of a document and its contents.
16. Providing ATM services
Commercial banks often operate ATM networks, which allow customers to withdraw cash from their accounts and perform other banking tasks at automated machines.
17. Providing credit reports
Commercial banks may provide credit reports, which show a person’s credit history and can be used to determine their creditworthiness.
18. Offering account reconciliation services
Commercial banks may offer account reconciliation services, which help customers ensure that their bank records match their own records and identify any discrepancies.
19. Providing mortgage services
Commercial banks offer mortgage services, which allow customers to borrow money to purchase a home or refinance an existing mortgage.
20. Offering small business banking services
Many commercial banks have specialized services and products for small businesses, including checking and savings accounts, loans, credit cards, and online and mobile banking services. They may also offer financial advice and planning services to help small business owners manage their finances and grow their businesses.
21. Providing merchant services
Commercial banks may offer merchant services, which allow businesses to accept card payments from customers and process them through the bank.
22. Offering payroll services
Some commercial banks offer payroll services, which allow businesses to automate the process of paying their employees and managing payroll taxes.
23. Providing business loans
Commercial banks provide loans to businesses for a variety of purposes, such as financing the purchase of equipment or inventory, expanding operations, or working capital.
24. Offering business credit cards
Commercial banks may offer business credit cards, which allow businesses to make purchases and pay for them over time with interest. These cards often have additional features such as rewards programs and the ability to track business expenses.
