What are the main Functions of State Financial institution of India?
The functions of SBI could be grouped beneath two types, viz., the Central Bank functions and ordinary banking functions.
A. Central Banking Functions:
The SBI acts as agent with the RBI with the places where the RBI does not have any branch. AccordВingly, it renders the following functions:
(a) Banker for the government
(b) Banker to banks within a limited method
(c) Repair of currency chest
(d) Will act as clearing house
(e) Renders promotional functions
(1) Banker to the Authorities:
The SBI functions because the company to the central and point out governments. That receives and pays money on behalf of the governments. Especially it renВders the following features as aimed by the RBI in this regard.
(a) Collection of charges on behalf of the us government e. g. collection of duty and other payments
(b) Grants loans and advances for the governments
(c) provides suggests to the federal government regarding monetary conditions, etc .,
(2) Banker's Bank:
Commercial Banks have accounts with SBI. If the banks face financial lack, the SBI provides assistance to them as it is considered a huge brother inside the banking sector. It discount rates the charges of the other industrial banks. Because of the functions about this line the SBI is recognized as in a limited sense while the banker's bank.
(3) Currency Torso:
The RBI maintains money chests at its own offices. But RBI OfВfices are situated just in big cities. SBI, buy the wide network of limbs operate in urban as well as rural areas. RBI therefore , in this sort of places retains money at currency boxes with SBI.
Whenever requirements arise, the currency is withdrawn by these boxes under proper accounting and reporting to RBI. At this time RBI entrust currency breasts to various other Public Sector Banks and some Private Sector Banks also.
(4) Will act as Clearing Home:
In all the spots, where RBI has no branch, the SBI renders the functions of clearing residence. Thus, that facilitates the inter bank funds. Since, each of the banks in such areas have accounts with SBI; it is possible for the SBI, to act since clearing house.
(5) Makes Promotional Features:
State Bank of India also renders various marketing functions. It offers various services to the pursuing priority sectors:
(ii) Small - Scale Industries
(iii) Weaker sections of the world
(iv) Cooperative sectors
(v) Small -- traders
(vi) Unemployed Children
(vii) Other folks.
In this respect SBI is like some other commercial financial institution.
B. General Banking Features
Besides the previously mentioned specialized functions, the SBI renders the following functions under Section 33 of the Work.
1 . Accepting deposits through the public under current, cost savings, fixed and recurring first deposit accounts.
2 . Advancing and lending funds and opening cash credit upon the safety of stocks, securities, etc .
3. Pulling, accepting, discounting, buying and selling of bills of exchange and other negotiable tools.
4. Investment funds, in specified types of securities.
five. Advancing and lending money to courtroom of wards with the earlier approval of State Government.
six. Issuing and circulating letters of credit rating.
7. Giving remittance facilities such as, demand drafts, email transfers telegraphic transfers, etc .
8. Behaving as officer, executor, trustee or otherwise.
being unfaithful. Selling and realizing the movable or immovable houses that come into the banks in satisfaction of claims.
twelve. Transacting pecuniary agency business on percentage stocks.
14. Underwriting in the issue of authorized stocks debentures, and other securities. (This function is completed through subsidiaries now)
12. Buying and selling of gold and silver.
13. It works Public Provident Fund Makes up the general public.
13. It runs nonresident External Accounts and Foreign Currency Accounts.
15. Offering Factoring assistance (through subsidiaries).