A central function of the financial system is to facilitate an efficient allocation of resources in the economy... Discuss.
in portfolios.
It is impossible to detail every function of the system as the variety of institutions and the different roles they play within the economy varies with each individual’s requirements. However, it is true to say that without it, the economy would still be in its initial form- a barter economy where goods and services were not purchased with money but exchanged for each other and borrowing facilities were unavailable. On the other hand, with it, the UK economy is more prosperous on both the domestic and international markets, where borrowers and savers can interact with the aid of intermediaries and other financial institutions to keep the economy flourishing.
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