Types and Functions of Money

 TYPES AND FUNCTIONS OF MONEY

MONEY:

• The word "money" is omnipresent in our daily lives, which is centred around it.

• We all need money to purchase things whether it be desirable or necessities.

• We work hard for earning money for our daily needs and need money to reach out working places.

• Money can be defined as any good that is widely used and accepted in transactions involving the transfer of good and services from one person to another.

• It acts as a medium of exchange.

TYPES OF MONEY:

1. Commodity money
2. Metallic money
3. Fiat or paper money
4. Fiduciary money
5. Bank money
6. Credit money
7. Electronic money
8. Plastic money
9. Fractional money
10. Representatives money

      1.commodity money:

• The most primitive types of money.

• Commodity money is a good whose value serves as the value of money.

• Eg; gold, tea, sugar, metal etc.,

      2. Metallic Money: 

• Throughout history, various metals some of which are precious today, appear to have been as a force of economy.

       3. Fait or paper money:

• Fait money is a good. The value of which is less than the value it represents  as money.

• The printing of paper money is typically regulated by a country's central bank in order to keep the flow of money in line with monetary policy.

• Eg. Paper, currency, coins 

       4. Fiduciary money:

• If the bank assures the customers payment in different types of money and if the customers can also sell theses promise or transfer them to somebody else.

• It is known as fiduciary money.

       5. Bank money:

• It consists of the bank credit that banks extend to their deposit

• Transactions made using cheque drawn on deposits held at banks involves the use of Bank money.

• Eg; DD, cheque, credit and debit cards.

       6. Credit money:

• Any future monetary chain against an individual that can used to ery good and services.

       7. Electronic money:

• The money which exist only in banking computer system and is not held in any physical form or rather is present in electron form.

• Eg; Bitcoins

       8. Plastic money:

•  Money is storage in certain electronic cash and cash card and transition made electronically.

      9. Fractional money:

• It is a hybrid money, when the commodity losses its value .

• The fractional money convert into fait money.

       10. Representative money:

• It is kind of token for currency that can be exchanged for a fixed quantity of commodity without the payment of money to the limit of the value of the representative money.

• Eg; gift card, etc,.