The banking system as the main direction of market economy

The banking system is the aggregate of all banks in the national economy. Currently, in countries where there is a developed market economy, this system has 2 levels - the Central Bank and commercial banks. The central bank can be represented as a set of other banking institutions that perform the functions of the Central Bank itself. The Central Bank performs all monetary functions - it exercises the monopoly of national currency, deals with loans and deals with other important functions. Commercial banks concentrate mainly on credit resources and carry out banking operations, as well as financial services for legal entities and individuals. Commercial banks can be subdivided into state, cooperative and joint-stock ownership forms.

In general, the banking system is a set of operating banks, credit institutions, and economic organizations that carry out banking operations. In addition to these organizations, the banking system also has specialized organizations that do not conduct any banking operations, but provide the activity of banks. For example, it can be cash settlement centers, dealer firms, audit firms, firms that work on securities, as well as organizations that work on the ratings of banks and provide banks with special information and equipment. All this is the banking system.

Banks and all credit institutions are constantly interacting with the following customers:

- with subjects of the economy;

- together;

- with the Central Bank;

- with other authorities.

The first such concept as the banking system arose for the first time in well-developed economic countries - Switzerland, Great Britain, Germany, Japan, the United States and others. For example, the Swiss banking system is one of the most powerful and advanced systems in the world.

As part of the banking system enters the large economic system of the country. This can be deciphered as the fact that this system is closely related to the consumption, production and circulation of various intangible and material goods. The success of the country's economic development largely depends on how the bank and the banking system function.

Banks that operate in the country can have a different system - two-tier or one-tier. The two-tier system speaks for itself - the first level is the Central Bank, and the second - credit institutions or commercial banks. Most of this kind is found in the world. A single-level system is rare, but it all becomes real when the country does not possess the Central Bank, or when it possesses, but only such Central Banks operate in this country.

In the modern rhythm of life and market economy, the banking system has quite a lot of functions. Changes that occur in this system, whether they are positive or negative, affect, as a rule, the entire economy of the country. In order for the banking system to function correctly, it is necessary to strictly comply with all requirements and develop all banking directions. And on this depends the normal functioning of the economy of the country.

For a good work of the credit policy, stability in the banking system is necessary. And the channel through which all monetary transactions pass is the banking sector, the whole banking system is directed to it.

In conclusion, we can say that the banking system is a holistic education that ensures a stable situation in the country. The banking system is part of a society that operates within the framework of laws and is subject to legal norms.