1. Formation of capital: Capital formation is the act of optimum utilization of limited capital for the development of country. Bank accepts the deposit to the unutilized money remained with the public and mobilizes it in the productive sector of country finding out the investment areas.

2. Mobilization of capital: It mobilizes the capital in the industrial, commercial, agricultural and service organizations which was collected under different accounts. It also performs the function of transferring money from one place to another.

3. Provides Loan: It provides loan to the persons and organizations against or without the security deposit of assets. Various banks have launched various procedures for providing loans.

4. Promotes Saving: Bank provides various type of facilities to the public who have deposited their money into the bank so it promotes saving. It also provides interest on deposit.