Different Types of Banks and How Do They Differ We all know that a bank is a place which takes care of its customer’s money, regulates it among the government and general public levels and financially assists its customers. However,it is only a lay man’s knowledge about a bank. Banks are of several types and they differ according to their dealings which are definitely about thefinancial matters. The banking principles and regulations diverge from country to country as well. The different customs and the demand of time also affect and change the legal technicalities. Different types of bankshave different domainsin which they perform their specified functions. Usually, banking is a business initself, and banks are profitable entities but some of the banks operated by government are non-profitable. The various basic types of banks are: - Retail Banks: These banks work with the individuals and small business owners. They deal in the mortgage loans, credit cards and saving accounts. - Business Banks: They deal with the middle scale industrialists and business owners. - Private Banks: The wealth management service, to elite class and large scale businessowners, is provided by private banks. - Investment Banks: Investment banks are engaged in the deals with the economic market. - Central Banks :Last but not the least is the central bank. All the central banks are usually under the government directly and they are responsible to have a check on the rest of the banks and also to control and manage the interest rates. They also offer help to the businesses and corporations but only ifthere is no other choice. Out of all the previously described types of banks, retail banks are sub-divided according to their functions. Following is a short briefing about the kinds of retail banks: - Commercial bank: Commercial bank is to deal with the loans, mortgages, and the credits of high level industries and businesses. In fact, the investment banks were limited to the investment market by the US Congress only after the Great Depression. - Community banks: The locally working corporation that makesthe financial decisions for its customers and partners. - Community Development Bank: The banks that financially serve the neglected population or market of the community. - Private Banks: We alsoconsider the privates banks under retail banks as they deal withthe general public individually too. There was a time when you had to deposit at least a million dollars to open an account in a private bank. However, this opening amount due to growing business has been reduced to quarter of amillion US dollars. - Offshore Banks: The banks with the least laws and low taxation are called offshore. They are usually under the private banks. - Ethical Banks: Ethical banks function on the honest and clear policies and believe in socially responsible financing only.