Channelling funds from individuals with savings to those desiring funds when the saver does not purchase the borrower's security is known as ________.

Question

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This describes the role of financial intermediaries such as banks, which accept deposits from savers and then lend these funds out to borrowers who need them. The intermediaries make money by charging a higher interest rate on loans than they pay out on deposits. A is incorrect because barter involves trading goods or services directly without the use of money. B is incorrect because redistribution typically involves governments or other organizations distributing resources or wealth from one group to another, rather than individuals lending and borrowing from each other. D is incorrect because taxation involves the government levying a mandatory fee on individuals or businesses, rather than voluntary financial transactions between savers and borrowers.

Channelling Funds from Individuals with Savings to Those Desiring Funds