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On Financial Institutions

Financial institutions collect funds from the public and invest them in financial assets like deposits, loans, and bonds rather than physical property. They provide important financial services and play a key role in economic development by providing funds, infrastructure, promotional activities, and helping develop backward areas and accelerate industrialization. The main functions of financial institutions are accepting deposits, providing commercial, real estate, and mortgage loans, and issuing share certificates. They also act as intermediaries and facilitate the flow of money. Financial institutions can be organized or unorganized banks, organized or unorganized non-banking financial institutions, or specialized development banks that provide both financing and help develop new enterprises.

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Ankit Poddar
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8K views8 pages

On Financial Institutions

Financial institutions collect funds from the public and invest them in financial assets like deposits, loans, and bonds rather than physical property. They provide important financial services and play a key role in economic development by providing funds, infrastructure, promotional activities, and helping develop backward areas and accelerate industrialization. The main functions of financial institutions are accepting deposits, providing commercial, real estate, and mortgage loans, and issuing share certificates. They also act as intermediaries and facilitate the flow of money. Financial institutions can be organized or unorganized banks, organized or unorganized non-banking financial institutions, or specialized development banks that provide both financing and help develop new enterprises.

Uploaded by

Ankit Poddar
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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FINANCIAL

INSTITUTIONS
DEFINITION
Institution  which collects  funds  from the  
public  and places  them in  financial assets,
such as  deposits,  loans, and  bonds, rather
than  tangible  property are called
Financial Institution.

In  financial economics, a  financial


institution is an  institution  that provides 
financial services  for its clients or
members.
IMPORTANCE
• PROVIDE FUNDS
• INFRASTRUCTURAL FACILITIES
• PROMOTIONAL ACTIVITIES
• DEVELOPMENT OF BACKWARD
AREAS
• PLANNED DEVELOPMENT
• ACCELERATING INDUSTRIALISATION
• EMPLOYMENT GENERATION
FUNCTIONS
• PRIMARY FUNCTIONS:
• Accepting Deposits.
• Providing Commercial Loans.
• Providing Real Estate Loans.
• Providing Mortgage Loans.
• Issuing Share Certificates.
• OTHER FUNCTIONS:
• ACT AS INTERMEDIARIES.
• FACILITATE THE FLOW OF MONEY.
TYPES OF FINANCIAL
INSTITUTION
1. BANKS
A. ORGANISED
B. UNORGANISED

2. NON-BANKING FINANCIAL INSTITUTION


A. ORGANISED
B. UNORGANISED
SPECIALISED FINANCIAL
INSTITUTION

SPECIALISED FINANCIAL
INSTITUTIONS ARE ALSO CALLED
DEVELOPMENT BANKS.THEY DON’T
ONLY PROVIDE FINANCE BUT ALSO
DEVELOPES NEW ENTERPRISES
ADVANTAGES OF RAISING
LOANS FROM SPECIALISED
FINANCIAL INSTITUTION
• AVAILABILITY OF FINANCE FOR
DEVELOPMENT SCHEMES.
• REASONABLE SECURITY
REQUIREMENTS.
• AVAILABILITY OF FINANCE DURING
PERIOD OF DEPRESSION.
• EASY REPAYMENT FACILITY.
• UNDERWRITING FACILITY.
THANK YOU

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