In an economy based on the division of labor, deals are made in goods and services. These trigger corresponding payment transactions. There is also a need to finance business. Credit institutions are companies that conduct banking business if the scope of these business transactions makes it necessary to conduct business in a commercial manner.
The aim of the credit institutions is to supply the other economic subjects of an economy (companies, state and households) with means of payment and loans. To achieve this goal, the credit institutions perform the following microeconomic tasks:
Exchange function: Credit institutions exchange liquid funds in various forms and amounts.
Depot function: Banks keep things and money safe.
Transport function: Credit institutions enable the rapid spatial transfer of money through a dense network of bank branches.
Financing function: By lending money to third parties for the short, medium or long term, credit institutions create the possibility of financing transactions of all kinds.
To carry out these tasks, credit institutions carry out numerous and complex banking transactions:
the Deposit business consist in the acceptance of short to long-term third-party funds with and without the granting of interest.
the Credit transactions consist essentially of the granting of money loans and the Loan loan.
in the Discount business banks take over the purchase of bills of exchange.
That Securities business consists of buying and selling securities on the capital market for own and third-party accounts.
in the Custody business valuables and especially securities are kept and managed.
in the Guarantee business Banks assume sureties, guarantees and other warranties for others.
That Giro business includes the entire handling of cashless payment transactions, billing transactions and collection business.
That Consulting business includes advising customers, from banking to business consulting, e.g. B. for small businesses and medium-sized businesses.