Financial Intermediation - What It Is And How It Works

1. PROMINENCE CLIENTS TRUST MANAGEMENT www.prominenceclienttrust.com

2. Financial Intermediation - What It Is And How It Works Financial Intermediation is the process by which an organization funds between the parties with surplus money and those who lack the required funds. Here the investor generates returns, while the manager attracts more capital.

3. Financial Intermediation is therefore a process in which two interested parties, through an investment management company or a financial intermediary, link their interests. The financial intermediary's job is to find people who are looking for investment options and put them in touch with the manager. • In this way, comply with what is required and, therefore, charge a commission that will vary depending on the amount invested, as well as the deadlines and other factors that we could cite. The person who performs this operation is called a financial intermediary.

4. How financial Intermediation helps a person? There are many reasons why a financial intermediary is used:  Information asymmetries: Often an intermediary is used when there is not enough information about the quality of goods or services.  Specialization: Although it is sometimes possible to achieve a direct relationship without intermediaries, the effort would be costly and could divert the central objective of the agent.  Channels of communication have been severed: Mainly in most cases, the intermediary helps to communicate to two parties that they have differences of opinion and that they have lost the ability to negotiate objectively.

5. Advantages of using financial intermediary services: Among the advantages of financial Intermediary services, the following should be highlighted:  The investment management company offers better options for investment through.  A more personalized service with the possibility of offering more alternatives to the investor.  Offer better services such as tax management, risk management, wealth management, asset management, and many more.  A more professional service with better monitoring of the client's situation. Depending on the requirement, the service will be highly personalized. This happens especially with very large companies that have completely standardized services.

6. How can you benefit from this service? You can benefit from financial intermediation by using the services offered by the bank at the right time. Since there are many other services offered by the bank, especially if you are running a business you can get benefitted from the services offered by the bank. Otherwise, if you are high net-worth individuals who wish to manage wealth, you can send or receive money in different currencies and manage wealth easily.

7. Also, if you wish to improve your wealth, you can use the investment management services offered by the investment management company to achieve your financial goals. Otherwise, if you are someone who visits many countries frequently then an offshore bank account will make it easier to handle your financial needs in any country.

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