Homework Answers
Financial intermediaries connect the borrowers to the lenders.
They resolve the problem of shortage of funds. They allow channeling of savings into investments thus developing the economy and making available large sources of finance to capitalists. They provide cash facilities and loans to the needy. They reduce the risk of investment by screening the borrower and assessing is creditworthiness. Financial intermediaries reduce time and cost and offer benefits of economies of scale by large scale dealings. They offer a large variety of services to the customers and even customize the same.
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