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Abstract
The financial system of a country is of immense use and plays a vital role in shaping the economic development of a nation. The volume and growth of the capital in the economy solely depends on the efficiency and intensity of the operations and activities carried out in the financial markets. An immature financial system hinders the growth of the economy. As the economy grows and become more complex and market oriented, the financial sector starts playing a crucial role in supporting growth by channelling domestic and foreign capital into productive investments. Increasing access to the financial system is also a main concern for making growth more balanced and sustainable from both social and economic perspectives. Financial system performs certain essential function for the economy including maintenance of payment system, collection and allocation of the savings of the society. The role of financial system is thus to promote savings and their channelization in the economy through financial assets that are more productive than the physical assets. The financial system of a country is an important tool for economic development of the country