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Functions of Development Banks
Functions of development banks can be classified as :

1. Development functions:
i. Special sectors promotion: Development bank contributes financial and technical
assistance for the establishment, development and growth of special sectors like
agriculture, transportation, hydro power, and other infrastructural sectors. Not
only financial and technical assistance is provided but administrative support
and suggestions are also provided.
ii. Identification of development need: Development need in economy is also
assessed by development bank. After the identification of such need and
feasibility study necessary resources are provided to materialize the possibilities.
iii. Market and product research: It is not a big challenge to produce the goods
but the real challenge is to have sustainable market for produced goods.
Development banks analyse the nature of the product and its market.
iv. Help in plans and policy: Development bank helps the special sectors to prepare
good plans and policies. For the smooth operation of the industry of special
sector, it helps to formulate plans, policies and to implement them.

2. Banking functions:
i. Accepts deposits: Like commercial banks, development bank also operates
accounts to accept the deposits from its clients.
ii. Provides loan: Development bank specially provides long–term and mid–term
loan for the development of agriculture, and industrial sectors. It provides
loan against either security deposit or on the guarantee of community. It
also provides short–term loan as per the need of clients. Mid-term and long-
term loans are provided for capital nature expense such as purchase of land,
machinery, technology support, etc.
iii. Purchase and sale of securities: It also performs agency like function of
commercial bank on behalf of customer. It performs the act of purchasing and
selling of shares, debenture and securities of various organizations.

Cheque

Meaning
A cheque is an unconditional written order issued by an account holder (drawer) to
bank (drawee) to make payment of written amount to a party or person specified.
It is commonly used in home trade for making payment of larger amount of bill.
Comparatively payment through cheque is considered as safe and comfortable
in business. A cheque may be thus defined as a document by means of which the
depositor can withdraw money from account. Cheques pass from hand to hand till

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