disintermediation

(redirected from disintermediated)
Also found in: Dictionary, Encyclopedia.
Related to disintermediated: Reintermediation

Disintermediation

Withdrawal of funds from a financial_institution in order to invest them directly.

Disintermediation

The act of making a withdrawal from a bank or other financial institution in order to use the funds for investment purposes. For example, one may withdraw $10,000 from his savings account in order to buy a stock without the bank's intermediation. This has become less common with deregulation of banking because more banks can offer investment services, reducing the incentive to withdraw.

disintermediation

The withdrawal of funds from financial intermediaries such as banks, thrifts, and life insurance companies in order to invest directly with ultimate users. Disintermediation was more of a problem when financial intermediaries were limited in the returns they could pay to savers. Deregulation of financial intermediaries was intended to dampen the periodic swings toward disintermediation. Compare intermediation.

disintermediation

a situation where a FINANCIAL INTERMEDIARY such as a BUILDING SOCIETY is forced to reduce its lending operations because of the withdrawal of deposits from it and because it is unable to attract new funds. Disintermediation usually occurs (and then only temporarily) when an intermediary (see INTERMEDIATION) fails to adjust its borrowing rates on deposits promptly when interest rates rise, so its rates are insufficiently competitive vis-à-vis other deposit-taking institutions.

disintermediation

The situation that exists when depositors withdraw their savings from financial institutions and invest the money directly in the marketplace,usually because they can obtain a higher yield even though also running a higher risk of losing their money.

Mentioned in ?
References in periodicals archive ?
Instead, academia has settled for the status quo and left its students disintermediated.
Franklin Warren McFarlan, a senior associate dean at Harvard Business School who first met Victor when he was a student and now sits on the company's board, recalls that the Fungs were worried their company would be disintermediated and therefore disappear.
Agents and brokers will continue to dominate distribution, and, rather than becoming disintermediated, will embrace Internet technologies and retain much of their current role.
Even today, he said, Nasdaq and other leading exchanges could be disintermediated by new entities that give investors better information,
The authors note that, because many users of online reference services have difficulties articulating what their question is about, automated disintermediated reference services face a substantial challenge.
Companies ranging from the Fortune 500 and Global 2000 to small independent businesses are working aggressively to avoid getting disintermediated, reintermediated, or otherwise obsoleted by this remarkable new technology.
What Ron has done is he's disintermediated, or eliminated, the editor.
Such an environment is said to be disintermediated.
There is a school of thought that says that risk managers are a dying breed; that along with insurers, who will be elbowed out of their own business by banks, and brokers, who will be disintermediated by the Internet, risk managers will see their responsibilities siphoned off by a chief risk officer who comes from the financial side of the house.
So why concentrate on the channel in a disintermediated world?
To what extent will E-commerce threaten my position, eg, is my company likely to be rapidly disintermediated by electronic channels/marketplaces?
A disintermediated market also needs new approaches to market analysis.