Money market is a term used to refer to the part of the financial market, in which takes place lending funds with short-term maturities (up to one year) on the credit (debt) principle. Unlike the capital market, where the horizon is medium or long-term, and it has rather the character of investment. Organizations receive liabilities in the money market.
In the money market there are various financial institutions that offer financial resources from the loan. On the other side, there are organizations and enterprises that need short-term funds to finance their activities. Financial institutions activity in the money market is regulated. Unlike the capital market, a private investor can’t enter the money market. However, financial institutions trade among themselves in the money market as well.
All financial institutions are part of the financial sector, namely they are:
- Mortgage Banks
- Insurance Companies
- Investment Funds
- Pension Funds
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