FINANCIAL INTERMEDIARIES/FINANCIAL INSTITUTIONS

Discover the different types of financial intermediaries, including the unorganized and organized sectors. Learn about the institutions that facilitate financial transactions for individuals and corporations, such as local money lenders, commercial banks, and government agencies.

• financial intermediaries
• unorganized sector
• organized sector
• capital market intermediaries
• money market intermediaries
• long-term finance
• short-term finance
• regulatory body

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Uploaded on Dec 08, 2023 | 3 Views

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1. FINANCIAL INTERMEDIARIES/FINANCIAL INSTITUTIONS

2. Different kinds of organizations/institutions which intermediate and facilitate financial transactions of both individual and corporate customers are called as financial intermediaries or financial institutions. Basically they are classified into two types: 1.Unorganized Sector 2.Organized Sector

3. UNORGANIZED SECTOR The sector that is not governed by any statutory or legal authority is known as unorganized sector. This sector consists of the individuals and institutions for whom there are no standardized rules and regulations governing their financial dealings.They are not under the supervision and control of RBI or any other regulatory body. This sector consists of the individuals and institutions like Local money lenders,Brokers,Traders,Landlords,Indigenous bankers,etc.,who lend money to needy persons and institutions.

4. ORGANIZED SECTOR The sector that is governed by some statutory or legal authority is known as organized sector. This sector consists of the institutions like Commercial Banks, Non Banking Financial Institutions, etc. They are further classified into two: 1. Capital Market Intermediaries 2. Money Market Intermediaries

5. CAPITAL MARKET INTERMEDIARIES Capital Market refers to the market for long term finance. The intermediaries provide long term finance to individuals and corporate customers. IDBI, SFCs, LIC, GIC, UTI, MFs, EXIM BANK, NABARD, NHB, NBFCs (Hire Purchasing, Leasing, Investment and Finance Companies) Government (PF, NSC) etc., are in the organized sector providing long term finance.

6. MONEY MARKET INTERMEDIARIES Money Market refers to the market for short term finance. The intermediaries provide short term finance to individuals and corporate customers. RBI, Commercial Banks, Co-operative Banks, Post Office Savings Banks, Government (Treasury Bills) are in the organized sector providing short term finance.