Financial Intermediaries Essay Example | Topics and Well Written Essays - 500 words

Financial Intermediaries - leaven ExampleThe most important one is security. As banks and other financial institutions playing this role claim the proper expertise to handle the flow of cash and make sure that it is returned on a set(p) time and date, they avoid any miscommunications and make sure that potential clients dont turn out to become criminals by not returning the loan. Therefore, by putting a savers eggs in a safe basket, they turn back that they are not stolen. Secondly, as these financial intermediaries are properly qualified to do this particular task, they are also better able to judge to whom it is safer to lend a savers money to. They keep an updated record of the types of customers who take in from them and of their repayment schedules. This helps in making predictions about which type of customer is a better choice to do business of lending money.The US Governments role is twofold in the economy. It has to look after the local and multinational intermediarie s and as well as act as an intermediary itself. This is done by two conk out governmental departments. The first is the SEC (Securities and Exchange Commission) and the second is the FDIC (Federal Deposit Insurance Corporation).