The socio-economic essence of finance, its functions

The social and economic essence of finance lies in the relations that occur between the state and other countries, individuals and legal entities in the distribution, formation and use of decentralized and centralized monetary funds that are formed into funds.

The totality of monetary and distributive relations is the economic essence of finance, without this the circulation of productive assets is impossible.

Financial relations, based on the movement of the centralized money supply of state funds, are distributed in the budgetary sphere and in governmental extra-budgetary organizations.

Finance performs control and distribution functions.

The redistribution of state income is the distributive function of the state. When primary incomes appear, the notion of "national income" arises, which is shared by all participants to the salaries of workers in the production sector, to the incomes of budgetary organizations, to fulfill their obligations to the state, banks and other lending organizations.

The state determines the socio-economic essence of finance, which works for the population and stimulates production.

Financial resources are carriers of money relations. The income and savings that are formed by the state and business entities are used in non-fund and fund forms.

The accumulative system of formation, separate existence, purposeful use is a distinctive feature of financial funds. They are intended for amortization fund and budget, to meet public needs.

One of the functions of finance is fiscal, with the help of which part of the income of business entities and the population is withdrawn to provide the state apparatus, defense, non-production (archives, libraries, schools, museums, theaters). Hence, it is also included in such a concept as the socio-economic essence of finance.

In the course of the work of the state and various financial organizations , funds are accumulated, which can then be redistributed as loans and are sources of credit.

A loan is a financial transaction that allows legal and natural persons to borrow money to purchase valuables. There are several types of loans: bank, trade loans and credit cards, installments.

The concept and essence of credit is to solve the problems that face the country's economic system. Here, too, is the socio-economic essence of finance, for example, in the granting of concessional loans for affordable housing purchases. By accumulating free capital, a dynamic production process is ensured. It accelerates monetary circulation and provides various relationships: investment, insurance, promotes the development and regulation of market relations.