Research indicates that a financial institutions' role as an intermediary is clearest in the credit and deposit business (Krayer, 2002). The usual function involves clients bringing to the bank their savings, or money which the bank transfers to its credit clients in the form of loans. In the loan instance, a borrower's credit rating may change during

Larger financial institutions play an additional role than just that of providing typical banking services. Financial institutions can form the core of economic development in a low-income community. For example, the World Bank's focus is on project lending and structural reforms that enhance long-run development and poverty alleviation (Stiglitz, 1998). The role of the World Bank in the global economy is to address pressing issues such as weak financial sectors, lack of transparency and poor governance in the corporate sectors, and weaknesses in external liability management will help restore confidence among foreign and domestic investors (Stiglitz, 1998). In this way, the World Bank acts to reactivate poor economies and thus to protect and extend social and economic achievements. In poorer countries, the World Bank appears to operate in coordination with the government as it steps in and fills the income-security gap that is left by companies closing and workers losing their jobs. Over the longer term, the World Bank will be working with countries to help them design

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