Commercial BanksA commercial bank is a type of financial intermediary and a type of bank. It raises funds by collecting deposits from businesses and consumers through checking deposits, savings deposits and term deposits. It provides loans to businesses and consumers. It also buys corporate bonds and government bonds. Its main liabilities are deposits and its main assets are loans and bonds. For example:- Bank of Baroda, Canara Bank, Dena Bank, etc. Commercial banks work with short-term funds. Their working capital mainly consists of money deposited by customers which can be withdrawn by them on demand or at short notice. If a bank lends such funds for long periods or otherwise keeps them tied up, it will not be able to respond to cash withdrawal requests from its depositors and will be forced to enter liquidation. Commercial banks are the most important source of institutional credit in the money market. A commercial bank is a profit-seeking business enterprise that deals with money or rather claims on money. Commercial banks are the largest banks in India. Commercial banks represent more than 80% of total bank credit. Functions of Commercial Banks Commercial banks perform a number of vital functions. The functions of a commercial bank can be broadly classified as follows: (1) Acceptance of deposits: -The bank collects deposits from the public. Deposits can be of different types – such as:  Savings Deposits:- This type of deposit encourages the saving habit of the public. The interest rate is low. Currently it is around 5% per year. Withdrawals of deposits are permitted under certain restrictions. This account is suitable for employees. This account can be opened in a single name or in a joint name.  Fixed Deposits: - A lump sum amount is deposited at a given time for a specified period. A higher interest rate is paid, which varies depending on the period of deposits. Withdrawals are not allowed before the expiry of the period. Current Deposits:-This type of account is managed by businessmen.Withdrawals are freely allowed. No interest is paid. In fact, there is a service fee. Account holders can benefit from an overdraft facility.  Recurring deposits: - This type of account is managed by employees and small traders. A certain amount of money is deposited into the bank periodically. allowed only after the expiration of a certain period.