Warning: Creating default object from empty value in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/plugins/independent-core/admin/ReduxCore/inc/class.redux_filesystem.php on line 29 Intermediation – Fincyclopedia
[wpdreams_ajaxsearchpro id=44 ]
  • Monday, April 28, 2025
  • The Financial Encyclopedia
[wpdreams_ajaxsearchpro id=43 ]

Banking

  Banking   |   Terms
  • 1049
  • October 5, 2020
[addtoany]
Notice: Undefined variable: myString in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/themes/independent/template-parts/post/content-single.php on line 41

Intermediation

The process of transferring funds from savers (saving or surplus units- also consumers or household savers) to borrowers (deficit units- also investors) whereby the former lend to an institution (intermediary such as a bank, a thrift, etc) which then lends the funds to the latter. This involves the borrowers dealing with the intermediary and not with the savers. Intermediation provides a number of advantages, specifically: (1) the spreading of the risk of a default on a loan over a large proportion of savers (depositors); (2) the pooling of the funds of so many savers in a single loan or investment; (3) economies (cost savings) in the credit evaluation of borrowers; and (4) liquidity transformation.


[related_posts_by_tax title="See also" posts_per_page="10" taxonomies="post_tag"]

[pt_view id=ee4674bifl]
[su_box title="Watch on Youtube" style="soft" box_color="#f5f5f5" title_color="#282828" radius="2" class="" id=""][su_row class=""][su_column size="1/1" center="yes" class=""] [/su_column][/su_row][/su_box]

Latest Terms

Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments

    Leave Your Comment

    Your email address will not be published.*