Which statement is true concerning financial intermediation?

The statement regarding customers who borrow being the bank's debtors is accurate because it reflects the fundamental relationship between banks and their borrowers. When individuals or businesses take loans from a bank, they are obligated to repay that loan, thus becoming the bank's debtors. This relationship is central to the banking system, where banks facilitate the borrowing of funds by providing loans to customers, who are then responsible for repaying them along with any interest.

This function of banks helps to connect savers, who deposit money with the bank, to borrowers who need those funds. Understanding this role is crucial for anyone studying financial intermediation, as it highlights how banks manage credit risk and liquidity in the economy.

The other statements do not accurately represent the broader understanding of financial intermediation. While it is true that depositors are creditors to banks, this statement alone does not capture the complexity of banking relationships. Additionally, stating that financial institutions act only as lenders overlooks their primary role as intermediaries, which involves not just lending but also managing deposits and facilitating various financial transactions. Lastly, the idea that only banks can be financial intermediaries ignores the fact that other institutions, such as credit unions, investment firms, and insurance companies, also serve as financial intermediaries in the