Financial intermediary
From Free net encyclopedia
The term financial intermediary may refer to an institution, firm or individual who performs intermediation between two or more parties in a financial context. Typically the first party is a provider of a product or service and the second party is a consumer or customer.
In the U.S., a financial intermediary is typically an institution that facilitates the channelling of funds between lenders and borrowers. That is, take deposits from savers (the lenders). From the pool of deposited money they may lend directly to borrowers. This may be in the form of loans or mortgages. Alternatively, they may lend the money indirectly via the financial markets.
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Types of financial intermediary
Financial intermediaries can be:
- Banks;
- Building Societies;
- Credit Unions;
- Financial adviser or broker;
- Insurance Companies;
- Life Insurance Companies;
- Mutual Funds; or
- Pension Funds.
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