Question

What is the primary role of commercial banks? Should banks be allowed to engage in services beyond banking (insurance, for instance)?

Answer 1

A primary role of a commerical bank is to accept deposits and lend money to needful individuals and businesses, and complying with the central bank and government laws that are defined for banking.

Banks should be allowed to engage in services beyond banking, given the condition that the banking system should not br affected by the services. In short, bank should jot face the risk of failure and there should be transparency of products for the consumer. If the primary motive is fulfilled and after complying with the law of the land, banks can engage in several non banking activities like insurance, locker services etc.