September 2021 1 4 Report
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Modern banking

 The goldsmith bankers were an early example of a financial intermediary.
A financial intermediary is an institution that specializes in bringing lenders and borrowers together.
A commercial bank borrows money from the public,crediting them whith a deposit. The deposit is a liability of the bank. It is money owed to depositors.It turn the bank  lends money to firms,households or govemments wishing to borrow.
Banks are not the only financial intermediaries,insurance companies,pension funds,and building societies also take money to relent them.
The payment,and are therefore part of the money stock.
Commercial banks are financial intermediaries whith a government  licence to make loans and issue deposits against
 which cheques can be written.
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