ABSTRACT
All financial intermediaries share the common central function of channelling funds between individuals or institutions with budget surpluses and those with budget deficits. However, intermediaries almost invariably specialize in the provision of services to specific groups within society, and often concentrate on taking up and on-lending specific categories of funds. Thus, some intermediaries may operate exclusively on a wholesale level, only being willing to deal in sums greater than a very large laid-down minimum value, whilst others may on-lend exclusively to retail customers. Some intermediaries may emphasize longer-term investments, whilst others specialize in the purchase of primarily short-term instruments. Furthermore, in addition to the basic intermediation activity, institutions also often provide various forms of non-intermediation services to their customers, which further contribute to their distinctive characteristics. However, whilst it is probably correct to assert that in the modern financial system each financial intermediary is almost unique in terms of the set of functions which it performs, it is nevertheless necessary to attempt to classify intermediaries in order that a general analysis of their activities may be undertaken.
