Disintermediation

Definition - What does Disintermediation mean?

Disintermediation is the flow of money from traditional bank accounts to alternative higher yielding investments such as stocks, bonds an other investments.

Testopedia explains Disintermediation

When an investor or saver withdraws money from a traditional financial intermediary such as a bank to invest those funds in higher yielding or higher returning opportunities the money is removed from the financial intermediaries and disintermediation occurs.

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