Additional Questions: What is Bank? | Introduction to Financial Markets for Class 9 PDF Download

Q.1. What is Bank and what does it do? 

A bank is a place where someone can deposit money for saving and safe-keeping and withdraw it when necessary. Banks pay interest to Depositor (Account holder) in return for depositing the money. If an accountholder needs money over and above his saving, then banks also lend money to him in the form of loan against interest.

Q.2. How can one deposit and withdraw money from bank? 

Deposits ( cash or cheque) can be made in a particular bank  account by using pay in slip which contains details of account holder like his name, account number, bank branch name apart from other details like amount to be deposited, cheque number of the cheque which are to be deposited, depositors signature.
Money from bank can be withdrawn by ATM, by withdrawal  form  which contains details like name of account holder, his account number, date of withdrawal, amount and his signature. Money can be withdrawn from bank by using cheque also writing “SELF”.

Q.3. Name the documents given to Account-holder after opening Bank account. 

(i) Pass Book  
(ii) Cheque Book
(iii) ATM card or debit card.

Q.4. State the difference between Bearer Cheque and A/C Payee Cheque. 

Bearer cheque means payee ( who receive the money) is the person whose name is appearing in the cheque and who carries the cheque to the bank to encash it. A/C Payee cheque means the amount mentioned in the cheque cannot be encashed over the counter by the bearer of the cheque, rather  the amount will be credited to the account-holder account  whose name is appearing in the cheque.

Q.5. State the types of Bank accounts.

Savings Bank account: This account is opened by generally individual in bank which offers low interest rate. One can deposit and withdraw any amount of money anytime. But savings bank account may have some restrictions like limited number of deposits and withdrawals during a particular period.
Current Account: This  type of account is generally opened by businessmen, companies . The balance  maintained in these accounts do not earn any interest. Accountholders get the benefit of more number of deposits and more number of withdrawals during a particular period. Moreover, the account holders get the facility to overdraw from their current account.
Fixed Deposits: In a fixed deposit, the depositor invests a lump sum amount with the bank for a predetermined period.  The bank offers interest for the same. This interest rate is higher than what is offered on the savings bank account. For premature withdrawal, bank will offer lower interest rate.

Q.6. State the benefits of electronic banking.

(i) Checking bank balances
(ii) Checking the banking transactions
(iii) Bill payment facilities like telephone bill payment.
(iv) Money transfer from one  bank account to another  bank account.