A financial institution is a business that provides services as an intermediary between two parties engaged in different types of financial transactions. These institutions are known as banks. They offer a variety of services and are essential to the world of finance. In addition to offering banking services, financial institutions are involved in lending, investing, and other types of transactions.
These businesses help customers invest and protect themselves against risks. They also regulate the money supply to keep the financial ecosystem healthy. The money supply process is essential for a healthy economy, and a financial institution must make sure that it is efficient. As such, it is imperative to know more about the policies and processes of these businesses before making any decisions.
Financial institutions can be either a retail or commercial bank, a credit union, an insurance company, or a brokerage firm. All of these types of organizations are used by people to manage their money and invest it. While banks and credit unions are more common, there are also a variety of other types of financial institutions that provide services to customers.
Another type of financial institution is an investment bank. An investment bank can help a business raise capital by selling shares or taking on debt. These companies help maintain financial stability by lending to businesses. Financial institutions also provide insurance policies that protect consumers and help create a more stable financial system.