Functions Of Bank Negara Malaysia

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Banking
On 24th January 1959, the central bank of Malaysia which is the Bank Negara Malaysia was officially opened. Bank Negara Malaysia is the main banking structure of the country by issuing currency notes and coins. Central bank is to promote monetary and financial stability. It plays an important role in stimulating growth in the financial sector and stabilizing the economy with respect to curbing inflation and combating recession. It is also responsible for the formulation and implementation of monetary policy to achieve financial and economic objectives.
The key objectives are:
• Issue currency and maintain the reserve safeguarding the value of the currency
• Act as a banker and financial advisor to the government
• Promote monetary stability
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The main function of commercial bank is deposit, leasing, payment transaction of cheque and foreign exchange service. They actively promote and cultivate the saving habit, especially among the younger generation. It is also an important strategy to fight unnecessary inflationary pressures on the economy of the country. Commercial bank should adjust their interest rate reasonable enough to attract money saver in the bank. The service and facilities offered by the commercial bank should be readily available at reasonable cost. Banker should educate the user on making the most out of the services and facilities by giving simple pep talks and publishing pamphlets and brochures, clarifying on the procedure and advantage of the various types of services and facilities available. As the financial intermediaries between the depositor and borrower, bank have to ensure that such fund lent out are for productive and economically viable purpose and activity for the betterment of the country as a whole.
The functions of commercial bank are:
• Retail banking service such as acceptance of deposit, granting of loan and financial guarantee
• Trade financing facilities such as letter of credit, discounting of trade bill, shipping guarantee, trust receipt and Banker’s
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Current Account is a form of working account and is operates through the uses of cheque. When Current Account is opened, the customer is issued with a cheque book and containing a certain amount of cheque leaves. A cheque is an instrument in writing issued by the customer to his banker to pay out a sum of money against the available balance standing to the credit of his account. Fixed Account is the form of investment or deposit account where a certain amount of money is placed in a bank for a fixed period period of time to earn interest.
Demand Draft is a payment order by writing an issue from an issuing bank to a payee to pay the amount stated in the draft and to the person specified in the draft. Telegraphic Transfer (TT) is to wire your money in a safe and quick mode of transfer to anyone, anytime and anywhere around the world. Mail Transfer is similar to TT but transaction is done by mail. Standing Instruction also known as Standing Order, is appropriate for the periodically payment to be made by issuing standing order from the

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