FEATURES OF THE FORMATION OF FINANCIAL AND CREDIT SYSTEMS IN A MULTI-FACETED ECONOMY

Abstract

It is determined that the formation of the financial system of Ukraine took place simultaneously with the development of its statehood. The components of the financial and credit system, which in total are two subsystems: financial and credit, are analyzed. Each of these subsystems is divided into spheres, and those in turn — on the links, subdivisions, etc. Although each element of the financial and credit system has its own organization, mechanism and functioning, they are all closely interconnected and have a great influence on the development of the national economy. It is noted that the banking system in Ukraine is under construction. It is built on the western type. Today in most countries of the world there is a two-tier banking system. In such a system, relations between banks are formed in two planes: vertically and horizontally. As the analysis shows, the market mechanism is not omnipotent. According to the goals of a democratic society, the market can not provide a noble redistribution of profits. In a crisis situation, the market has little effect on the stabilization of the economy and the effective functioning of the credit and financial system. Certain investment funds, insurance companies and credit and financial institutions are engaged in activities that are unusual for them, harming the public: attracting contributions from the population that perform the functions of savings and commercial banks on the principle of a pyramid, thus causing a wave of bankruptcies. It is substantiated that the public purpose of the financial and credit system characterizes the functions and gives a clear idea of its role, that is, the "work" that this system performs in society. The functions of the financial and credit system are an objective and dynamic phenomenon. Each of them is formed and developed with the development of financial and credit relations and the economic environment in which this system operates. It was concluded that financial and credit relations are one of the most important categories of a market economy, which reflects the real relations and interconnections of economic entities in the economic life of society. The financial and credit interaction of banks and enterprises has always been and remains an important lever for stimulating the development of production and reflects the economic relationship with the reverse movement of borrowed value.

Keywords

• financial and credit system
• multi-economy economy
• banking institutions
• money-credit multiplier
• savings and loan associations
• leasing companies