What is the Difference Between Bank and Banking?

The difference between a bank and banking lies in their nature and the services they provide. Here are the key differences:

• Bank: A bank is a financial institution that accepts surplus money from people in the form of deposits and uses that money to provide loans to individuals, businesses, and government agencies. It is a physical location with resources like buildings, staff, and furniture. Banks can be in the form of sole proprietorships, partnerships, or other organizational structures.
• Banking: Banking refers to the financial services that a bank provides to its members and clients. These services include accepting deposits, granting loans, opening savings accounts, and offering credit and debit card facilities. Banking is the output of the bank by utilizing its resources to provide financial services. It is not a separate entity but is based on the entity of the bank.

In summary, a bank is a physical institution that handles money and provides financial services, while banking refers to the services and activities carried out by the bank to meet the financial needs of its customers.

Comparative Table: Bank vs Banking

The difference between a bank and banking can be understood by comparing their definitions:

Banks can be classified into different types, such as retail banks, commercial or corporate banks, and investment banks. Retail banks cater to individual customers and offer services like savings accounts, checking accounts, and loans for personal use, while commercial banks provide services tailored to business clients, including day-to-day business banking, credit services, and cash management. Insurance companies and investment banks, on the other hand, are involved in creating, accumulating, and managing financial assets and liabilities by incurring debt or equity.

In summary, a bank is a financial institution that provides various services, such as accepting deposits and making loans, while banking refers to the actual activities and operations of a bank.