THE ROLE OF FINANCIAL INSTITUTIONS IN ECONOMIC GROWTH AND DEVELOPMENT

Authors

  • Mirzaakhmedova Sabokhat Muzaffar kizi Master's Student in Foreign Economic Activity at University of World Economy and Diplomacy Author
  • Gulyamova Gulshaxnoz Sabirovna Scientific Advisor, Professor of the Department of International Finance and Investments at University of World Economy and Diplomacy Author

Keywords:

Financial institutions, economic growth, financial intermediation, capital allocation, risk management, market efficiency, entrepreneurship, innovation, technological progress, investment, digital transformation, financial inclusion, banking sector, regulatory challenges, sustainable development.

Abstract

This paper explores the multifaceted role of financial institutions in driving economic growth and development. It examines the theoretical foundations of financial intermediation, market efficiency, and risk management, highlighting how institutions mobilize savings, allocate capital, facilitate payments, and reduce information asymmetry. The analysis also discusses how financial institutions contribute to entrepreneurship, innovation, and technological advancement, drawing on real-world examples and data from organizations such as the IMF, World Bank, and Asian Development Bank. Finally, the paper addresses contemporary challenges, such as digital transformation, cybersecurity, and regulatory complexities and assesses future prospects for building a resilient, inclusive financial system. The findings underscore the indispensable role of robust, adaptive financial institutions in fostering sustainable and inclusive economic progress.

Downloads

Published

2025-06-13

Issue

Vol. 1 No. 3 (2025)

Section

Articles

License

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.