The financial system basically consists of a market that become the place where public and private interest meet. The financial system provides the capital collected from investors that can be an individual or a group of individuals to be invested for other party that can be other individual, firm, business organization or government institution that manage the fund to get the resources to do business transactions. To get the benefit of the transaction, the investor can obtain debt capital, equity capital, or other products of investment that can be acquired as debt and securities, property or other financial products.
Although finance is very close to the relation of economic science, practically finance is quite apart and distinctive if compared to economic. Economic probably becomes the basic science of finance, but the application and the practical form of finance is very flexible as a form of applied art.
The economy basically is an activity that consists of production, consumption and distribution of things, and all of the process of production, consumption and distribution is something that has to be financed. Finance is something that makes the economy going by providing the power of production and distribution and the power to buy the product for consumption.
Finance is usually mentioned as the process of managing money or fund. It is defined as the part of business activity that consists of the work of origination, marketing and managing money. The money or fund is managed through capital accounts, market and market instruments that create transaction, trading of assets, liabilities and risk. Finance is a concept that arranged, structured and regulated by such system that connect the power relation with economy politic in the market, globally and locally.