The socio-economic essence of finance, its functions
Socio-economic essence of financelies 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 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.
Redistribution of state income -distribution function of the state. When primary incomes appear, the notion of "national income" arises, which is shared by all participants in the salaries of workers in the production sphere, on 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. Income and savings, which are formed by the state and business entities, are used in non-fund and fund forms.
Cumulative formation system, separateexistence, targeted 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 ofwhich withdraws part of the income from business entities and the population to provide the state apparatus, for defense, for non-productive sphere (archives, libraries, schools, museums, theaters). Hence, it is also included in such a concept as the socio-economic essence of finance.
During 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 allowslegal entities and individuals to borrow money for the purchase of material values. There are several types of loans: bank, trade loans and credit cards, installments.
The concept and essence of a loan is to solveproblems that face the country's economic system. Here the socio-economic essence of finance is also concluded, for example, in granting concessional loans for affordable housing purchases. By accumulating free capital, a dynamic production process is provided. It accelerates monetary circulation and provides various relationships: investment, insurance, promotes development and regulation of market relations.