What are the differences between commercial banks and non-bank financial institutions?

List the differences between commercial banks and non-bank financial institutions.

(i) Commercial banks offer safety locker facilities while non-bank financial institutions do not offer safety locker facilities.

(ii) Commercial banks are members of clearing house/ clear cheques through clearing house while non-bank financial institutions are not members of clearing house/ do not participate in clearing cheques.

(iii) Commercial banks provide foreign exchange services while non-bank financial institutions do not exchange foreign currency.

(iv) Commercial banks lend money to all sectors while non-bank financial institutions lend money for specific sectors.

(v) Commercial banks are regulated by the central bank/ Banking Act while non-bank financial institutions are not regulated by Banking Act but other Acts.

(vi) Commercial banks provide short-term loans while non-bank financial institutions provide long term loans.

(vii) Commercial banks provide current account facilities/ issue cheque books while non-bank financial institutions do not provide current account facilities/ Do not issue cheques books.

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maurice.mutuku answered the question on July 26, 2017 at 08:27

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