There are many commercial bank limitations, like high collateral requirements, limited rural reach, and a focus on short-term loans. Here are the 7 major limitations that commercial banks have:
Commercial banks have strict eligibility criteria, restricting access to loans for many.
Borrowers often need significant assets to secure loans.
They prioritise short-term lending over long-term investments.
Variable interest rates can affect borrowers greatly.
Banks often lack sufficient branches in rural areas.
Banks avoid high-risk ventures, limiting support for innovative startups.
Their lending capacity is bound to deposit inflows. This limits their flexibility during financial crises.
There are more but these are the most significant ones among them.
Avail Personal with Minimum Documentation and ZERO Hassle with NB InstaCash
Read More:
What are the Functions of commercial bank?
Your Feedback Matters! How was this Answer?
Shifting, House?
✔
Lowest Price Quote✔
Safe Relocation✔
Professional Labour✔
Timely Pickup & Delivery
Intercity Shifting-Upto 25% Off
Check Prices

Intracity Shifting-Upto 25% Off
Check Prices

City Tempo-Upto 50% Off
Book Now
Leave an answer
You must login or register to add a new answer .
What are the Limitations of a Commercial Bank?
CHEBI MIRABEL LINGWANG
39 Views
1
51 days
2025-01-22T12:31:45+00:00 2025-01-22T12:31:46+00:00Comment
Share