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Financial institution
 | This article needs additional citations for verification. (March 2020) |
A financial institution, sometimes called a banking institution, is a business entity that provides service as an intermediary for different types of financial monetary transactions. Broadly speaking, there are three major types of financial institution:[1][2]
- Depository institution – deposit-taking institution that accepts and manages deposits and makes loans, including bank, building society, credit union, trust company, and mortgage broker;
- Contractual institution – insurance company and pension fund
- Investment institution – investment bank, underwriter, and other different types of financial entities managing investments.
Financial institutions can be distinguished broadly into two categories according to ownership structure:
Some experts see a trend toward homogenisation of financial institutions, meaning a tendency to invest in similar areas and have similar business strategies. A consequence of this might be fewer banks serving specific target groups, and small-scale producers may be under-served.[3] This is why a target of the United Nations Sustainable Development Goal 10 is to improve the regulation and monitoring of global financial institutions and strengthen such regulations.[4]
- ^ Siklos, Pierre (2001). Money, Banking, and Financial Institutions: Canada in the Global Environment. Toronto: McGraw-Hill Ryerson. p. 40. ISBN 0-07-087158-2.
- ^ Robert E. Wright and Vincenzo Quadrini. Money and Banking: Chapter 2 Section 5: Financial Intermediaries.PDF. Accessed July 24, 2012.
- ^ Jayati Gosh (January 2013). "Too much of the same". D+C Development and Cooperation/ dandc.eu.
- ^ "Goal 10 targets". UNDP. Archived from the original on 2020-11-27. Retrieved 2020-09-23.
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