Specialized credit and financial institutions

Specialized credit and financial institutions - the third link of the credit system. In recent years, specialized non-bank credit and financial institutions, which have taken a prominent place in the accumulation and mobilization of money capital, have played an important role in the national capital markets of developed countries. These institutions include insurance companies, pension funds, building societies, investment and financial companies, charitable foundations, credit unions. These institutions significantly pressed banks in the accumulation of savings of the population and became important suppliers of loan capital.

Three main reasons contributed to the growing influence of specialized non-banking institutions: income growth in developed countries, the active development of the securities market, and the provision of special services by these institutions that banks could not provide. In addition, a number of specialized non-banking institutions, unlike banks, can accumulate cash savings for quite long periods and, therefore, make long-term investments

Specialized credit and financial institutions are financial organizations that are not banks, which base their activity on attracting customer funds and placing them on the terms of repayment, maturity, and payment. Such institutions are pension funds, insurance, trust, leasing, investment companies, investment funds, pawnshops. If non-bank credit organizations carry out their activities mainly for commission, specialized credit and financial institutions earn on the difference between the cost of placement and the cost of raising funds.

A leasing company is a commercial organization carried out in accordance with the law of the Russian Federation and with its constituent documents of leasing functions. The founders of leasing companies can be legal entities and individuals, both resident and president. Leasing refers to a type of business activity aimed at investing temporarily freely attracted monetary funds, when under a financial lease (leasing) agreement the lessor undertakes to acquire the property of the contractual property and a certain seller, to provide this property to the lessor during use for business activities.

Lombard is a legal entity specializing commercial organizations, whose main activities are the provision of short-term loans of citizens and storage of things

The pawnshop has the right to accept movable property belonging to the borrower with the exception of items withdrawn from circulation, as well as things for which the legislation of the Russian Federation establishes restrictions on pledge and deposit. The pawnshop is prohibited to engage in any other business activities, except for the provision of short-term loans of citizens, storage of things, as well as the provision of consulting and information services.

Pension funds are based on contributions from employers and citizens. Most of their liabilities are long-term. Therefore, they have the opportunity to invest funds raised in long-term securities. The legislation establishes requirements for the diversification of their investments (assets), as well as the inadmissibility of high risk.

Investment funds are joint-stock companies whose activity is to raise funds and invest them in securities, bank deposits, etc. The share of each investor is proportional to his investment.

Investment funds are divided into mutual funds (PIF) and equity.

PIF is an organization uniting investors with an investment share.

An investment share is a registered security certifying the right of its owner to present its management buyout requirements to a management company, that is, it is a security that confirms that the investor has a certain share in the mutual fund assets.In addition to shares, the mutual fund may include cash, including foreign currency in accounts and deposits of a credit institution, as well as shares of Russian joint-stock companies, securities of foreign countries and international financial organizations, and others.

Joint-Stock Investment Fund (AMF) is an open joint-stock company, the exclusive subject of activity of which is property investment in securities by law. AIF has the right to carry out its activities only on the basis of a special permit (license).

Investment companies differ from investment funds in that they place their shares, as a rule, among legal entities and often take the form of a holding when they specialize in managing controlling blocks of shares.