Describe the examples of financial intermediaries in Kenya.

      

Describe the examples of financial intermediaries in Kenya.

  

Answers


Kavungya
1. Commercial Banks.
They act as intermediary between savers and users (investment) of funds.

2. Savings and Credit Associations
These are firms that take the funds of many savers and then give the money as a loan in form of mortgage and to other types of borrowers. They provide credit analysis services.

3. Credit Unions
These are cooperative associations whose members have a common bond e.g employees of the same company. The savings of the member are loaned only to the members at a very low interest rate e.g. SACCOS charge p.m interest on outstanding balance of loan.

4. Pension Funds
These are retirement schemes or plans funded by firms or government agencies for their workers. They are administered mainly by the trust department of commercial banks or life insurance companies. Examples of pension funds are NSSF, NHIF and other registered pension funds of individual firms.

5. Life Insurance Companies
These are firms that take savings in form of annual premium from individuals and them invest, these funds in securities such as shares, bonds or in real assets. Savers will receive annuities in future.

6. Brokers
These are people who facilitate the exchange of securities by linking the buyer and the seller. They act on behalf of members of public who are buying and selling shares of quoted companies.

7. Investment Bankers
These are institutions that buy new issue of securities for resale to other investors.
Kavungya answered the question on March 12, 2019 at 05:10


Next: Define financial intermediaries.
Previous: Give the advantages of Investing In Shares.

View More Business Finance Questions and Answers | Return to Questions Index


Exams With Marking Schemes

Related Questions