Distinguish Between Commercial Bank and Co-operative Bank

square 1. Registration ↓


In India, the Commercial Banks are required to be registered under Banking Regulation Act, 1949.

In India, the Co-operative Banks are required to be registered under the Co-operative Societies Act, of the concerned state.

distinguish between commercial bank and co-operative bank

square 2. Main Objective ↓


The main objective of a Commercial Bank is to accept deposits from public for the purpose of lending to industry and commerce.

The main objective of a Co-operative Bank is to accept deposits from the members and the public for the purpose of providing loans to farmers and small businessmen with a motto of service.


square 3. Availability of Funds ↓


Massive funds are available at the disposal of Commercial Banks.

Limited funds are available at the disposal of Co-operative Banks.


square 4. Area of Operation ↓


Commercial banks operate over a larger area. Some commercial banks even have branches in foreign countries.

The area of operations of Co-operative Banks is limited and mostly confined to State. They do not operate at national level nor international level.


square 5. Nationalisation ↓


At present 20 Commercial Banks have been nationalised in India.

In India Co-operative Banks are not nationalised.


square 6. Merchant Banking Services ↓


Commercial Banks provide merchant banking services such as advising the companies regarding the public issue of shares.

Co-operative Banks do not provide merchant banking services.


square 7. Mutual Funds ↓


Commercial Banks in India such as Canara Bank, Bank of India, State Bank of India, do operate mutual funds.

At present co-operative banks in India do not operate mutual funds.


square 8. Basis of operation ↓


Commercial banks operates on the commercial principles. They operate to earn a profit.

The basis of operations is on co-operative lines, i.e. service to its members and the society.


square 9. Rate of Interest ↓


The Commercial Banks provide a lesser rate of interest as compared to co-operative banks.

The Co-operative Banks provide a little higher rate of interest on deposits as compared to commercial banks.





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