question_answer

Differentiate between Central Bank and commercial bank.

Answer:

Difference between a Central Bank and a commercial bank are: (any four)

Basis	Central Bank	Commercial Bank
Status	Central Bank is the banker of all the banks. It is an apex body.	Commercial banks operate under the control of Central Bank.
Credit flow	It controls the flow of credit within the economy.	It created within the economy.
Objective	The objective of Central Bank is social welfare.	The objective of commercial banks is profit maximisation.
Banker	It is the banker to the government and commercial banks.	It is banker of the common public.
Custody of foreign exchange	It is the custodian of nation?s foreign reserve.	It is not the custodian of foreign reserve.
Currency issue	It has the authority to issue currency	It does not have the authority to issue currency.