Finance Banking

Role Of Banking And Finance In The World Economy

Published at 01/23/2012 03:40:31


Banking and finance play vital role in the World economy. The banking helps in controlling the rate of the foreign exchange. It also adjusts the rate of the foreign exchange. The banking controls the financial stability in the World economy and plays an important role in controlling the interest rates. The inflation rate is now maintaining through the banking and the finance in the World economy. The banking and finance supply the money equally and mobilize the resources or the financial resources. These different banking and the financing systems are playing the advisory role in the development of the world economy. The banking system controls the deflation rates. Through this banking and the finance system, the persons whose income is more and the requirements are less then they can invest the extra money. On the other hand, those persons having the income less and more expenditures then they can take some money or borrow through this banking and finance systems. However, the borrower has to pay the amount of the money at the higher interest rates to the bank. These banking and the finance system help in arranging the loan for the borrowers. The individuals use the personal finance, the government uses the public finance, the businesspersons use the corporate finance the schools, and the other different organizations use the corporate finance.


Therefore, in this the finance system helps these different organizations and to the individuals persons and thus increases the economy of the World. This banking and sponsorship give them the money to run a small business and to run the organization. The organization and the small business of the people can return this loan after getting the benefits. Therefore, through this process both the host and the guest are getting the benefits from each other’s and can increase the economy. This banking and the finance system increases the coordination between the lenders and the borrowers. The finance and the banking system also issue the debt for the public projects to the NGO’s.


The banking and finance systems are introducing new tool, techniques or the methodologies to increase the economy of the World. In the management of the business this banking and the finance plays vital role. The business and the finance include the decisions to use the funds properly to increase the economy of the World. In the banking and finance the corporate finances helps in raising the funds and do effect the economy. The finance includes different methods like the debt financing and the equity financing.

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Now the banking as well as finance is organizing in different sectors, corporate banks and the foreign owned commercial banks. This banking and finance helps in improving the conditions of the rural areas. This system can provide the net credit to the priority sectors. These priority sectors include the retail trades, the agriculture, the small business and the small or large-scale industries. This banking and finance systems fulfill the goals for the social development. This step also helps in increasing the economy of the overall World.