The process in which financial institutions accept savings from businesses, households, and governments and lend the funds to other businesses, households, and governments is called

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Financial intermediation is the process through which financial institutions accept deposits or savings from businesses, households, and governments and lend the funds to other businesses, households, and governments for various purposes including investment, consumption or capital expenditure. This process involves the transfer of funds from savers who have surplus funds to those who require funds, thereby facilitating economic growth and development. Central Banking System refers to the institutions responsible for managing a country's monetary policy and regulating its financial system, while moral hazard and adverse selection are risks associated with lending and borrowing activities in financial markets.

The Process in Which Financial Institutions Accept Savings from Businesses