Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers on the bank, and collecting cheques deposited to customers’ current accounts. Banks also enable customer payments via other payment methods such as telegraphic transfer, EFTPOS, and ATM.
Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to customers on current accounts, by making installment loans, and by investing in marketable debt securities and other forms of money lending.
Banks provide almost all payment services, and a bank account is considered indispensable by most businesses, individuals and governments. Non-banks that provide payment services such as remittance companies are not normally considered an adequate substitute for having a bank account.
Banks borrow most funds from households and non-financial businesses, and lend most funds to households and non-financial businesses, but non-bank lenders provide a significant and in many cases adequate substitute for bank loans, and money market funds, cash management trusts and other non-bank financial institutions in many cases provide an adequate substitute to banks for lending savings too.
Banks offer many different channels to access their banking and other services:
- ATM is a machine that dispenses cash and sometimes takes deposits without the need for a human bank teller. Some ATMs provide additional services.
- A branch is a retail location
- Call center
- Mail: most banks accept check deposits via mail and use mail to communicate to their customers, e.g. by sending out statements
- Mobile banking is a method of using one’s mobile phone to conduct banking transactions
- Online banking is a term used for performing transactions, payments etc. over the Internet
- Relationship Managers, mostly for private banking or business banking, often visiting customers at their homes or businesses
- Telephone banking is a service which allows its customers to perform transactions over the telephone without speaking to a human
- Video banking is a term used for performing banking transactions or professional banking consultations via a remote video and audio connection. Video banking can be performed via purpose built banking transaction machines (similar to an Automated teller machine), or via a videoconference enabled bank branch.
- HISTORY BANKING
Banking business starts from the Babylonian era, continued to Ancient Greece and Rome. At that time, the main activities of the bank just as a place to exchange money. Furthermore, the activities of the bank evolved into daycare and borrowing money. The money saved by the people, by the bank loaned back to the people who need them.
Meanwhile,regarding history of banking in Indonesia is inseparable from the Dutch East Indies colonial era . At that time there are some banks that play an important role in the Dutch East Indies, among others: De Javasche NV, De Post Paar Bank, De Algemenevolks Crediet Bank, Nederland handles Maatscappij (NHM), handles Nationale Bank (NHB), and De Escompto Bank NV.
In addition, there are also indigenous-owned banks, China, Japan, and other Europeans. Banks include: the National Bank Indonesia, Bank Abuah Merchant, Boemi Bank NV, The Matsui Bank, The Bank of China, and Batavia Bank.
The banks in the early days of independence, among others:
a. Bank Negara Indonesia, which was established on July 5, 1946 and then became BNI 1946.
b. Bank Rakyat Indonesia, which was established on February 22, 1946. This bank was derived from DE Algemene bank or Syomin VOLKCREDIET Ginko.
c. Bank Surakarta MAI (Carriage Adil Makmur) in 1945 in Solo.
d. Bank Indonesia in Palembang in 1946.
e. Bank Dagang Nasional Indonesia in 1946 in Medan.
f. Indonesian Banking Corporation in 1946 in Yogyakarta, and then became Bank Amrita.
g. Bank NV in Manado, Sulawesi in 1946.
h. Indonesian Trade Bank NV in Banjarmasin in 1949.