Assignment

Topic : Difference Between ratio used in Financial and

Non-financial institution

DEFINITION of 'Financial Institution - FI'

A financial institution is an institution that provides financial services for its clients or members. Probably the greatest important financial service provided by financial institutions is acting as financial intermediaries. Most financial institutions are regulated by the government.

OR

An establishment that focuses on dealing with financial transactions, such as investments, loans and deposits. Conventionally, financial institutions are composed of organizations such as banks, trust companies, insurance companies and investment dealers. Almost everyone has deal with a financial institution on a regular basis. Everything from depositing money to taking out loans and exchange currencies must be done through financial institutions.

Non Financial Institution

NBFIs work to offer enhanced equity and risk-based products. The major intermediaries that are included in the NBFI group are Development Finance Institutions (DFIs), insurance companies, non-banking financial companies (NBFCs), primary dealers (PDs) and capital market intermediaries such as mutual funds. The NBFIs provide medium-to long-term finance to different sectors of the economy.

Difference between Financial institution and Non-financial Institution

1. Financial institution accepts deposits while non financial institution does not accept deposits

2. Financial institutions deal with customers directly while non financial institution deals with banks and governments

3. Financial institution takes part in all activities concerning finance while non financial institution is concerned with loans needs of large enterprises.

4. Financial institution deal with both internal and international customers while non financial institution concerned with finances of foreign companies.

Ratio’s used in Financial and Non-financial Institution

Financial...