Introduction To

Business

Money &
Chapter
Banking
17

1
Money & Exchange System
 Money– Anything commonly accepted as
a means of paying for goods and services.
 Money enable us to function in the society
and to have the things we need to
survive .
 Various things used as money. such as---
coins, paper bills, fur, pelts, gold
coins,salt.

2
 Functions of Money–

 As a medium of exchange –money

enables two individuals to exchange without
having to barter.
 As a measure of relative value-money
allows two dissimilar items to be purchased on
similar basis.
 As a store of value- money enables us to
hold onto the value over time.

3
Characteristics of Money
 Acceptance
 Divisibility
 Portability
 Durability
 Stability
 Scarcity

4
Financial institutions:
Their role in business.
 Commercial Bank.
 Nonbanking Financial Institutions

5
 Commercial Bank.

A profit making institution that holds the

deposits of individuals and businesses in
checking and saving accounts and then
uses this funds to make loans.

6
Activities of Commercial
Bank:
1. Checking and saving accounts
2. Business loan
3. Credit cards
4. Safe deposit boxes
5. Discount brokerage services
6. Transfer of funds
7. Financial advice
8. Overdraft protection
9. Travelers check
10. ATM.
7
 Nonbanking Financial
Institutions

1. Insurance company
2. Pension funds
3. Large brokerage houses
4. Commercial and consumer finance
companies