Different types of FIs are: 1. Depository Institutions: These are the FIs, those accepts deposits. These deposits represent the liabilities of the deposit-accepting institution. Their income is derived from two sources: a) the income generated from the loans they make and the securities they purchase, and b) fee income. The various types of depository institutions are: a. Commercial Banks: It provides numerous services in financial system. The services can classify into i) individual banking, ii) institutional banking, and iii) global banking. b. Credit unions: They are commonly known as cooperative societies. The purpose of credit union is to service their members̢۪ saving and borrowing needs. 2. Insurance companies: it provides insurance policies, which are legally binding contracts for which the policy holder pays insurance premium and the company promise to pay to policy holder on the occurrence of future events. 3. Mutual Funds: These are the portfolios of securities, mainly stocks, bonds, and money market instruments. The investment manager actively manages the portfolio i.e. buy and sell securities. 4. Pension funds: It is a fund that is established for eventual payment of retirement benefits financed by contribution by the employer. A pension is a form of employee remuneration for which the employee is not taxed until funds are withdrawn.