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Q: When the financial system has achieved a high degree of efficiency?
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How does the possibilty of financial intermediation increase the efficiency of the financial system?

Financial intermediation is a way of indirect finance. Some lenders prefer lend indirectly via financial intermediaries by using financial instruments. Indirect finance is as important as direct finance for the financial system to survive. Thus, financial intermediation is an asset for an efficient financial system.


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Without organization, order and structure cannot be achieved. If in a system that relies on efficiency in function, and these are not achieved, kaos will prevail, and the system will break down. The importance, therefore, can be immeasurable to the success of any group attempting to function toward a single goal.


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What are the nature of the financial system?

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What are the key components of the financial system?

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