FINANCIAL INTERMEDIATION AND FINANCIAL INTERMEDIARIES

FINANCIAL INTERMEDIATION AND FINANCIAL INTERMEDIARIES 

Financial Intermediaries 

Financial Intermediary is a term which signifies an institution, a firm or an individual who acts as a mediocre between savers and investors or lenders and borrowers. He does financial intermediation between two parties in such a way that one party is borrower of funds and second party is lender of funds. It helps to channelize funds from savers to investors. It accepts deposits from those who have surplus funds and lends to those who are seeking investment opportunities. 

Types of Financial Intermediary 

There is a wide variety of financial intermediaries in India. It may be banking or non-banking; organized or unorganized; public or private etc. typically financial intermediaries can be fit into following categories: 

• Commercial Banks (SBI, PNB, HSBC etc.) 
• Development Banks (SIDBI, IDBI) 
• Brokers 
• Financial advisors 
• Insurance companies (GIC, LIC, AIG etc) 
• Credit Unions 
• Mutual Funds like SBI mutual funds, UTI mutual funds etc. 
• Pension Funds like PPF (Public Provident Fund), EPF (Employees Provident Fund) etc. 
• Building Societies like HUDCO, HDFC etc.