Banking is very important for the business or an economy. It is a financial institution that is involved as payment agent for customers and facilitates borrowing and lending of money also.
Banking is important to business because businesses deposit their extra money here. This way their money is not only safe but also earns interest for them. On the other hand, businesses can borrow money from banks when they need to invest in their businesses.
Apart from that Banks also act as guarantee giver in case of creditors and suppliers.
There are various ways through which banking is considered very important for business sectors. The major reason is that banks provides loans for businesses. Loans are given to both the start ups and the existing companies. In fact, there is uneven distribution of the wealth in the world. Those people who have money may not have business skills and those who have entrepreneurial skills may not have money. Therefore, people who posses money keep it in banks and make it safe. The bank with some interest offer the same money as loans to those who want to start their business. In this way, banks act as intermediaries, between creditors and debtors. Banking sector plays an important role in money circulation in the economy. That's why banking is considered very important in business.