Role of Banking System in Economic Development

Banks are essential to the nation's economic growth. They amassed the savings of human inactivity and made them available for investment. They also build a new search deposit in the lending system and buy investment securities. They facilitate domestic and foreign trade by accepting and discounting trade loans. Banks also increase cash flow. All commercial banks in India except Rural Regional Banks and Local Banks have been compliant since March 31, 2009. In a country like India in the early stages of economic development. A formal banking system is a necessity for the day. Commercial banks are the most effective way to generate cash flow of debt in the market. There is a severe shortage of funds in India. Banks can play a key role in promoting financial sustainability, controlling speculation and maintaining a balance between needs and availability and available and direct visual resources into desired channels. Given that Agriculture is the backbone of any country like India. The study is based on Day Two which provides the findings of commercial banks and how they are useful for economic development. So, this study will help to find out how commercial banks are useful in purchasing debt, employment in rural areas and how they will contribute to India's economic development.