The financial crisis that occurred in 2007 and 2008 highlighted one of the crucial functions of commercial banks and other financial institutions in developed economies.A crucial function that ceased to work smoothly during this time,and contributed to the global recession that began in 2008,was

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The provision of credit to firms, households, and other banks is the function that ceased to work smoothly during the financial crisis of 2007-2008. Many banks and financial institutions were heavily involved in risky lending practices and investments, which led to a widespread credit crunch and contributed to the global recession. The other functions listed (acceptance of deposits, joint regulation of financial markets, cheque clearing, and electronic transfer clearing) were not the primary cause of the financial crisis.

The Financial Crisis That Occurred in 2007 and 2008 Highlighted