Role of Banks

Paper Summary:

This paper explains how the role of the banks in an economy can be analyzed by using the concept of financial intermediation between debtors and creditors in the economy. It also points out that they can be defined according to the traditional functions of financing, collection of resources and administration of payment methods.

From the Paper:

"In order to emphasize the role of the banks, it is necessary to accurately place them in the midst of the financial system, as its main component. From a financial perspective, there are, at a general macroeconomic level, two categories of participants with complementary preoccupations: the ones who are in need of financial resources and who wish to procure them and the ones with financing capabilities who desire to efficiently place their capital. The function of the financial system is to represent the interface between agent with surplus and with deficit of resources."

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