Home › B.Com Banking & Insurance › Banking and Finance › Money and Financial Institutions › Financial institutions split into which two broa…
Financial institutions split into which two broad groups?
AProfit-making institutions and not-for-profit ones
BDepository institutions and nondepository institutions
CNational institutions and international institutions
DInsured institutions and uninsured institutions
Answer & Solution
Correct answer: B. Depository institutions and nondepository institutions
1. Financial institutions divide into two broad groups.
2. Depository institutions are those that accept deposits.
3. Nondepository institutions are those that do not accept deposits, though they may provide certain banking services.
4. Profit status cuts across both groups, since a credit union takes deposits without seeking profit while a brokerage firm seeks profit without taking deposits.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 15 "Understanding Money and Financial Institutions", section 15.3 U.S. Financial Institutions_
Related questions
Why can a large payment processor spot fraud better than a single merchant can?A banking chatbot is best described as what?Which service channel costs a bank the most to provide?What is happening to branch banking as mobile services spread?Which services do fintech firms typically provide?What makes international banking a high-risk venture?Why can lighter regulation abroad make life hard for a bank expanding overseas?Why do large banks look beyond their own national borders?