Banks play a key role in the financial sector by contributing to economic growth and the services of individuals and entities. In addition to the basic function of lending, banks can provide various other services that help the economy to function smoothly. Serving the general public with a variety of services, they perform representation functions such as collecting bills of exchange, offering pension and insurance services with the aim of social responsibility, pushing for savings and protection (compensation for property and accidents). But by offering investment products, acting as financial advisers helping their clients with stock quotes, bond offers as well as mergers or acquisitions.
In contrast, the central bank is a financial institution where it differs from the rest. It is the body that regulates the entire banking and monetary system of the country, finding the ways by which it will achieve the goals set by the government (inflation targets) in order to maintain economic stability, managing the monetary and credit system of the nation. It is a non-profit public institution unlike the rest where it can be either public or private with non-profit functions. The link between the two is the role of the central bank to regulate various parameters of commercial banks such as the ratio of cash reserves, the legal liquidity ratio and also exercising direct controls in cases of ethics and emergency lending of banks.
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