| Sr. |
Points |
Central Bank |
Commercial Bank |
| 1 |
Ownership |
Government has the ownership of Central Bank. |
Commercial Banks are controlled privately. However in Pakistan some banks were nationalized in 1974. |
| 2 |
Management |
The management & employees are appointed by the Government. |
The management and other employees are appointed by the board of directors. |
| 3 |
Deposits |
Central bank cannot receive the deposit of the public |
Commercial banks can receive the deposit of the public. |
| 4 |
Loans |
The central bank provides the loan to the government and commercial banks. |
Commercial banks provide the loans to the customer. |
| 5 |
Aim |
Economic development is the aim of the central bank. |
Earning profit is the primary aim of the commercial bank. |
| 6 |
No. of Banks |
There is only one central bank for every country |
Every country has many commercial banks |
| 7 |
Foreign Branches |
Central bank has no branch in foreign country |
Commercial banks may have branches in foreign country. |
| 8 |
Account holder |
The government and commercial banks are the account holders of central bank |
The individuals, partnership, limited companies are the account holders. |
| 9 |
Advisor |
The central bank advises the government on financial matters |
The commercial banks advise their customers for investment, business consultancy etc. |
| 10 |
Note issue |
Central bank has the sole right of note issue |
Commercial bank cannot issue the notes. |
| 11 |
Exchange control |
Exchange control is the responsibility of the central bank |
Exchange control is not the responsibility of commercial bank. |
| 12 |
Control of credit |
Central bank has the authority on control of credit |
Commercial bank has no authority on control of credit |
| 13 |
Control & growth of Banking |
It is the duty of the central bank to control the growth of banking |
Control and growth of banking is not the responsibility of the commercial bank. |
| 14 |
Foreign payment |
The central bank makes the foreign payment on behalf of the government |
Commercial banks makes the payments on behalf of the customers. |
| 15 |
Metallic reserves |
Central bank keeps the metallic reserves like gold |
Commercial banks do not keep the metallic reserves. |
| 16 |
Transfer money |
It transfer money from one place to another for the government and banks. |
It transfer money from one place to another for the people. |
| 17 |
Evening banking |
Evening services are not provided by the central bank |
Commercial banks provide evening banking services. |
| 18 |
Wind up |
The central bank cannot be closed up even if working at loss |
Commercial banks hold reserve with central bank. So that it could help them in difficulties. |
| 19 |
Lender last resort |
Central bank acts as a lender of last resort for commercial bank |
Commercial banks hold reserves with central bank, so that it could help them in difficulties. |
| 20 |
Governing act |
Usually the laws governing central bank are difficult from that which governs commercial banks. In Pakistan SBP is governing by SBP Act 1956 |
Commercial banks are governed by different laws. In Pakistancommercial banks work under companies Ordinance 1984. |
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