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Mixed banking is a system of banking where a bank combines both deposit banking as well as investment banking. In other words, the bank will provide short-term loans for commerce and trade and long-term finance for industrial uints. Such a type of banking was prevalent in Germany, where banks there were providing both short-term as well as long-term loans. In fact, in Germany industrialisation was rapid due to this type of banking.
While this type of banking promotes rapid industrialiation, the mixed banking system reduces the liquidity of funds of commercial banks. Stated differently, it difficult to pay back the borrowed funds of customers whenever they make a demand of their money. This is because funds get blocked when the bank gives long term loans to industries.
M.J. SUBRAMANYAM, BANGALORE, India
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∙ 11y ago
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What is mixed banking?
When a bank combines the deposit as well as investment banking activites, it is called mixed banking. In other words, when banks perform the dual function of commercial banking and investment banking, i.e., provide long term lending to industries. it is called mixed banking. It all stared in Germany. After indutrial development took place. there were no banks in Germany to provide long term finance to these industrial units. So the commercial banks in Germany were forced to finance to these industries both for short-term as well as for long-term requirements. These banks, were therefore, called mixed banking. That is they were doing the functiion of a commercial banks as well as investment banks. M.J.SUBRAMANYAM, BANGALORE, INDIA
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What is mix operations?
Mixed banking is a system of banking where a bank combines both deposit banking as well as investment banking. In other words, the bank will provide short-term loans for commerce and trade and long-term finance for industrial uints. Such a type of banking was prevalent in Germany, where banks there were providing both short-term as well as long-term loans. In fact, in Germany industrialisation was rapid due to this type of banking. While this type of banking promotes rapid industrialiation, the mixed banking system reduces the liquidity of funds of commercial banks. Stated differently, it difficult to pay back the borrowed funds of customers whenever they make a demand of their money. This is because funds get blocked when the bank gives long term loans to industries. M.J. SUBRAMANYAM, BANGALORE, India
Is the banking system in India whether mixed or branch banking?
Most banks in India offer branch free banking or core banking. If you have an account with the bank you can operate it in any of the bank's branches. This may attract charges as applicable but you can operate it anywhere. There are also some smaller banks that offer only branch specific banking. you will not be able to operate those accounts anywhere else. Almost all banks have migrated or are migrating to core banking.
