译文银行业是必要的而银行不是，互联网时代的金融中介机构的未来摘要本文探讨了互联网时代下金融机构和银行作为特殊的金融机构的未来可能是怎样的问题。
由于互联网而导致的交易费用的减少会降低进入金融产品市场的壁垒，因为有可能不再需要运行成本密集型的分支的大型系统。
但是，对金融机构的职能研究表明，不是每个人都可以销售和经销金融产品。
这是真的，因为金融业务中的信息不对称问题需要一个拥有良好信誉的中介，也因为需要限制大型资本基金转换资产的风险。
这两个要求变现了进入金融中介市场的重要壁垒。
并不是每一个金融产品会因为互联网的崛起而将面临更多的竞争，只有那些标准化和低风险的产品。
此外，那些拥有可观资本和良好声誉的大公司可能被视为银行的新竞争者。
关键字：银行业，银行，金融机构，互联网1、引言“银行业是19世纪的钢铁行业。
”当谈到关于新的信息技术对银行的影响的谈论时，这句话经常被提起。
更一般来说，可能有人会问，新信息技术是如何成功的，特别是互联网的，可能会改变商业和金融机构的市场情况。
在互联网的帮助下，人们可以执行所有银行的业务，而不需要银行。
这意味着传统银行分支机构的中介。
此外，互联网已经使客户直接从网上购买股票而不需要访问当地的分支银行。
从更广泛的意义上来说，在互联网的帮助下，金融市场的供给和需求可能通过互联网满足，而不需要金融中介机构。
互联网的崛起是否真的是金融中介机构的威胁？在急剧减少的交易成本情况下，商业和竞争将如何变化？本文考察了互联网的成功对金融机构和银行的影响。
2、金融机构的发展几个世纪以来，许多金融交易需要个人的存在。
随着现代信息技术的发展，这些都被改变了。
如今，客户可以在不进入当地分支银行的情况下进行任何金融交易。
转移支付和支付账单可以通过网络进行，个人金融交易以及关于金融问题的信息咨询业可以通过网络进行。
此外，互联网创新类似智能卡或者其他电子支付系统消除了为了得到一些现金而访问分支银行的需要。
但是互联网也会改变咨询活动：在许多情况下，它甚至可能减少个人存在的需要。
许多金融机构不仅通过网络提供大量与客户相关的信息，而且也推荐股票和其他投资机会。
互联网将使客户拥有一个综合的个人金融管理系统，而不需要银行分支或者个人经纪。
另一个重要的业务是支付交易：目前，借记卡和信贷业务以及现金付款，主要是通过银行和信用卡公司。
因为电子传输比传统支付系统更加便宜、快捷和方便，它可能只是一个时间问题，直到传统付款计划将完全被电子支付所取代。
相反这些发展，现代通信技术的兴起也可能使金融中介机构嫩巩固提高顾客的个人联系。
在未来，顾问在银行的工作地点可能不是一个部门或者一个办公室，而是在客户的家里。
3、金融中介机构的职能金融中介机构的职能可以分为三类：⑴首先，他们帮助处理由于信息问题而存在的问题。
⑵作为第二功能，他们转换资产的性质，为他们的客户提供流动性。
后者的功能主要由银行提供。
⑶作为第三功能，金融中介机构发布金融产品和关于这些产品的信息。
这些功能现在应当再间断的解释。
金融中介机构最重要的功能源自于这样一个事实，一个银行可能无法找出回报最好和最佳的投资，无法估计债权人的偿付能力。
金融中介代理解决信息问题的债务人,帮助找到最好的投资。
一个中介也对第二个信息问题有帮助：大多数投资需要大量的资金,大量的债务人将资助一个项目。
单一银行可能无法监控债权人的行为,这样他可能不确定贷款的债权人是否用在最好的用途以便他偿还贷款。
中介通过监测债务人来充当这些债权人的代理。
这个论点表明他们是在给客户节约交易成本，同时考虑规模经济，因此他们可以提供比单个投资者更便宜的金融服务。
金融机构的第二个作用是他们转换获得的资产。
他们将不同期限、大小和风险的资产进行转换。
对于单个银行或者借款人来说，找到一个合适的需要贷款的伙伴将非常耗时。
金融中介可以转换期限和存款或贷款池的大小。
比如,他可以资助一个大的长期贷款循环许多小的短期贷款。
通过提供一个集中的市场，中介机构支持银行和借款人的匹配提供的所有类型。
中介来匹配的能力显然不一致的类型的合同有时被称为转化效果。
金融中介机构的第三个功能可以被描述为产品和关于这些产品的信息的分布。
金融中介机构提供服务的生产者的金融产品，分销他们的产品，通知消费者产品的存在和特征。
4、互联网下的金融中介机构4.1金融业务良好声誉的必要性互联网最重要的一个特性是降低交易成本。
这将导致市场的扩张和劳动力的分工。
交流成本的减少将帮助金融中介机构达成新的市场和客户，不需要建立一个昂贵的分支网络。
此外，在互联网的帮助下，从技术观点来看是可能的，银行和借款人都在电子平台上因此资本供给和需求可以被匹配，而这可能都不需要传统意义上的金融中介机构。
这意味着计算机将是获得贷款或储蓄的唯一的工具。
考虑到金融中介机构的功能上面所讨论的,这个想法很不现实。
不是每个人都能成为一个金融中介机构。
但是怎么使出借人信任那些金融中介机构呢？它可能联合借款人欺骗出借人。
这是一个由于信息不对称而存在的经典的主要代理问题。
解决这个问题的一个方法是信任:如果代理显示出了良好的性能在过去,投资者愿意相信这个代理。
金融中介的良好的声誉将帮助他吸引新顾客,因为新投资者确信他过去好的结果。
4.2大型基金的必要性金融中介机构的第二项职能包括哪些？如上所述,金融中介机构帮助转换资产的成熟、规模和风险。
第一眼看去，因为潜在借款人和贷款人沟通成本的减少，互联网将让资产转换变得更加便捷。
通过互联网，将更容易找到适当的寻求贷款的合作伙伴，而借款人又有提供相当规模和成熟度的贷款的意愿。
正如上面的小节中解释的那样，中介机构的一个重要功能是，一个集中的市场供应来缓解资本的供应需求匹配了。
这不是真正的转换资产的风险。
加入大型基金，金融中介机构可以减少投资者的投资风险。
如果银行贷款给一个人,借款人未能偿还贷款,贷款人将损失所有的钱。
如果银行未能偿还贷款金融中介,中介不会破产,因为这种贷款只占一小部分的资金。
正如以上所说，做这样的金融中介机构需要一个很大的基金池。
这种基金同时也需要保证客户一定数量资金的流动性。
保持一定量的必要性的资产无疑是一个障碍对新进入者进入市场金融服务。
考虑到这些因素,我们可以假设与金融交易的风险更大,需要更多的资金来减少这种风险,或资产(这意味着较小的标准化该资产的流动性较差的市场)新的竞争对手的进入可能会变得不太可能,因为并不是每个中介可以保持一个大型基金的资产,以改变消费者的风险资产,并保证他们的流动性。
4.3金融产品的分布但是互联网可能克服金融中介机构的第三个功能:金融产品和信息的分布会变得比现在更容易和便宜。
这意味着成本密集的银行分支机构可能会变得过时:电子货币的发展，网上银行和在线咨询可能使这种中介形式的减少。
这意味着金融中介进入这个市场的一个重要壁垒可能会消失。
但是尚不清楚银行的传播职能将会过时。
这可能只适用于通过分支机构的产品和信息分布。
5、金融中介机构的未来考虑到金融中介机构的功能，有一些关于金融中介机构未来发展的注意事项。
首先尚不清楚互联网的兴起会导致金融服务领域中介机构的多或少。
道德风险和信息不对称等问题将不会完全被消除的互联网,所以,金融中介仍然是必要的。
此外,市场的扩展将通过互联网将提供更多专业化的机会,从而为金融中介机构创造新的商业机会。
市场的扩大和交易成本的降低也会扩大分工的数量,从而为中介机构创造更多的商业机会。
但是同时银行也存在潜在的危险：由于上面列出的参数和分支的减少系统的必要性,新的竞争者可以进入市场并提供的产品或服务被提供之前只能通过银行。
金融产品的两个特征可能很重要，如果一个人想要回答未来金融产品的竞争：金融产品的标准化程度和它的风险。
产品的标准化程度决定了质量评价的需要,减少了关于产品和客户信息的需要。
考虑这些金融服务的特点，可以哪些金融产品提供的可能仍然是传统的金融中介机构和哪些产品可能基于互联网的新中介机构。
总的来说，金融中介机构将不会成为未来几十年的“钢铁行业”。
银行业不会消失，此外，金融服务的需求将日益旺盛。
然而，这种需求不仅对银行有利，而且对大公司和保险公司也有利。
互联网甚至可以创造新的就业机会：互联网上日益增加的信息可能需要一个代理金融信息服务。
此外，互联网的兴起可以促进虚拟金融中介机构的发展：他们可以通过互联网向不同的公司或银行提供各种金融服务。
外文原文Banking is essential, banks are not. The future of financial intermediation in the age of the InternetThis paper examines the question how the future of financial intermediaries and banks as special financial intermediaries may look like in the age of the Internet. The reduction of transaction costs caused by the Internet will reduce the barriers to enter the market for financial products, because there may be no longer a need to run a large system of cost-intensive branches. But as closer examination of the functions of financial intermediaries shows, not everybody can sell and distribute financial products. This is true because of asymmetric information problems in financial business which require an intermediary with a good reputation and because of the need to keep large funds of capital to transform the risk of assets. Both requirements represent an important barrier to enter the market for financial intermediation.Not every financial product will be exposed to more competition due to the rise of the Internet but only products which are standardized and have a low risk. Moreover, large firms with high amounts of capital and a good reputation can be considered as new competitors for banks.Keywords: banks, banking, financial intermediaries, Internet1. Introduction“Banks are the steel industry of the nineties.” This statement is often heard when it comes to a discussion of the consequences of new information technologies for banks.More in general, it can be asked, how the success of new informationtechnologies,especially of the Internet, may change business and market situation for financial intermediaries.With the help of the Internet it will be possible to execute all banking business from home without the need of a bank. This would mean the end of traditional banking by means of branches. Moreover, the Internet already enables customers to buy stocks directly without visiting a local branch of a bank. In some years it may be even possible to buy stocks via the Internet directly from the issuer without the need of a stock exchange and a broker. In a broader sense, with the help of the Internet it may be possible that supply and demand on financial markets may meet via the Internet without the help of financial intermediaries. Is the rise of the Internet really a threat for financial intermediaries? How will business and competition change in a world with extremely strong reduced transaction costs? This paper examines the consequences of the success of the Internet for financial intermediaries and banks. A financial intermediary shall be Paper presented at the Second Berlin Internet Economics Workshop.defined as an institution that acts as an intermediary on capital markets by matching supply and demand on these markets. He does not only provide market transparency but moreover acts as a middleman between lenders and borrowers.A bank is a special financial intermediary with a lot of cost-intensive local branches. Moreover, a bank provides a bundle of different services while most other intermediaries only concentrate on one or few specific business. For example, a bank provides credit to firms and private customers, sells stocks and mutual funds and pays interest for saving deposits and distributes the money it receives from the central bank by providing its customers with cash. (These arguments are valid for the European Universalbanken system, but partially also for the anglo-american Trennbanken system.) As a consequence, the balance sheet of a bank consists of immediately withdrawable liabilities which are used as legal means of payment as well as of liabilities with a longer maturity. Moreover, a lot of these liabilities deposited by the customers are not assigned to a special purpose. To sum up, a bank bundles a lot of financial products and services like consulting and is not as much specialized than other financial intermediaries.The second section will give a short overview of developments in the financial sector driven by technical progress. The third section will examine the functions of financial intermediaries and how they will be affected by new information technologies. In the following section, some conclusions shall be drawn from these considerations. This may help to answer the question how the landscape for financial intermediaries willlook like in the age of the Internet.2. Developments in financial intermediationFor centuries, many financial transactions required personal presence. This has changed with the rise of modern communication techniques. Nowadays a customer can do all his financial business without entering a local branch of a bank. This can be demonstrated with online-banking: The customer does all his banking (business) at home via the Internet. The transfer of payments and the payment of bills can be done via the net and information about personal financial transactions as well as consultation about financial questions can also be given via the net. Moreover, innovations like smart cards or other electronic payment systems eliminate the need to visit a branch in order to get some cash.But the Internet will also change consulting activities: it may even reduce the need for personal presence in many cases. Many financial intermediaries provide not only a lot of customer-relevant information via the net, but also recommendations on stocks and other investment opportunities. Moreover, techniques like video-conferencing or Web-TV by means of a so-called settop-box will enforce this development. The Internet will enable intermediaries to bundle the capacities of their consultants wherever they may be located. This means that a customer can consult many experts from without even leaving his home. The Internet will enable a customer to have a comprehensive personal financial management system without the need of a branch or personal contacts. Banks like Barclays have already implemented a system called RATE (remote access to exTHE FUTURE OF FINANCIAL INTERMEDIATION IN THE AGE OF THE INTERNET 9 perts): Customers can contact specialist staff at Barclays Stockbrokers in Glasgow for detailed advice. The experts can give comments and background information as well as predictions by using a video-conference-link within the screen (see [5]).These forms of banking without branches will not only appear in the home of customers but even in remaining branches. A first glimpse at the potential branch of the future can be caught at the Lisbon Branch of the Banco Portugues do Atlantica (BPA).Instead of human staff the customer is faced with a set of multimedia kiosks set into the walls, which not only distribute money, but offer a range of other functions (see [5]): a scanner reads the bill, deducts the money from the account of the customer, transfers the money to the account of the issuer and notifies the company that the bill is paid. The end of this development may be a virtual bank, where all financialbusiness will be executed via the Internet without the need of any branches.Another important business are payment transactions: At the moment, the debit and credit business as well as cash payment is mostly done by banks and credit card companies. Because electronic transmissions are much cheaper, quicker and easier than conventional payment systems, it may be only a matter of time until traditional payment schemes will be replaced completely by electronic purses. But even classical intermediation services of banks as the emission of stocks or industrial obligations may be replaced by direct emission of these securities by the enterprises themselves. Opposite to these developments, the rise of modern communication techniques may also enable financial intermediaries to improve the personal contact to their customers.In the future, the working place for a consultant in a bank may not be a branch or an office, but the home of the customer. Laptops and mobile phones may help him to bring his back-office to the home of the customer. This development is called “mobile consulting” (see [3]).This short overview shows that the rise of the Internet may change the business of financial intermediaries in many ways. The most striking point in these developments may be the fact that financial intermediation in the age of the Internet may no longer require the existence of branches because much of this business will be done via the Internet. The word of a virtual bank has already spread (an overview can be found in[9,10]).This may have important implications on the competition in financial intermediation as later shall be shown. To get an idea how financial intermediaries may look like in the digital future, it will be necessary to examine the functions of a financial intermediary.With these functions in mind, it will be possible to ask how these functions will be affected by the growth of Internet-based financial business.3. Functions of financial intermediariesThe functions of financial intermediaries can be divided into three categories (for an overview over theories of financial intermediation see also [1]):First, they help to deal with questions that arise due to the existence of information problems.As a second function, they transform the nature of assets and provide their customers with liquidity. The latter function is mostly provided by banks.As a third function, financial intermediaries distribute financial products and information about these products.These functions shall now be explained in brief. The most important function of financial intermediaries arises from the fact that a single lender may not be able to find out the best investment with the highest return and to estimate the solvency of the creditor. A financial intermediary solves both information problems by acting as an agent for the debtor and helping to find the best investment. An intermediary helps also with the second information problem (see [9]): Most investments require larger amounts of money so that a large number of debtors will finance one single project.A single lender may not be able to monitor the behavior of the creditor so that he may not be sure whether the creditor uses the loan in the best way so that he will be able to pay it back. The intermediary acts as agent for these borrowers by monitoring the lender. Thereby, he also acts as principal for the lender by supervising him. By solving these information problems for many lenders, intermediaries are realizing economies of scale. This argument shows that they are saving transaction costs to their customers and that they can provide financial services much cheaper than a single investor due to the existence of economies of scale. By acting as an agent for the lender and principal for the borrower, financial intermediaries also provide a certain amount of control about lenders and borrowers, i.e., they provide a certain level of quality of the financial products they distribute. This gives more security to their customers about their savings and loans and saves transaction costs by providing an appropriate definition and level of quality.The second function of financial intermediaries is the transformation of the assets they acquire. They transform maturities, size and risks of these assets. For a single lender or borrower, it would be very time-consuming to find an appropriate partner who wants to give a loan in the amount and time-horizon desired by him. A financial intermediary can transform the maturities and the size of savings or loans by pooling them.E.g., he can finance one large long-term loan by revolving many small short-term loans.Intermediaries support the matching of lenders and borrowers of all types by supplying a centralized market for them. The ability of intermediaries to matchapparently inconsistent types of contracts is sometimes called transmutation effect (see [8]). Moreover, a intermediary can also transform the risk of an asset. He guarantees the borrower a certain interest rate and gives his money as venture capital, thereby transforming a risky investment into a safe one. The difference between the interest rate the lender receives from the intermediary and the interest rate the intermediary demands from the venture capitalist is the risk premium. By pooling savings and loans, intermediaries provide the possibility for a single customer to trade the risk of a single loan or saving against a share of the risk of a portfolio of these savings and loans. With the help of the law of THE FUTURE OF FINANCIAL INTERMEDIATION IN THE AGE OF THE INTERNET 11,large numbers, the possibility of a total loss for a single investor can be diminished by pooling large funds.As easily can be seen, the transformation of maturities and the transformation of risks requires a certain amount of deposits. This makes it clear that a financial intermediary needs a certain minimum size –measured in terms of deposits –to perform these functions well. This will be an important feature in the discussion of the future business fields for financial intermediaries. These funds are also necessary for another function of financial intermediaries that is mostly done by banks: Banks provide their customers with liquidity. A consumer has to take measures against a sudden unexpected need of consumption. Without a bank, he would be forced to keep a certain amount of liquidity as an insurance against this case instead of investing it in long-term interest rate bearing assets. If he gives his money to a bank, it can be invested into such assets while it is still possible for the customer to get money in cases of unexpected needs of liquidity, thereby loosing only a smaller share of the return of these assets than in the case of keeping this money as an insurance against a sudden need of consumption. By transforming the maturities of its deposits, a bank allows its customers to keep a smaller amount of liquidity as it would be the case in a world without banks.The third function of financial intermediaries can be described as the distribution of products and of information about these products. Financial intermediaries provide services for the producers of financial products by distributing their products and informing consumers about the existence and the characteristics of their products. For example, a bank provides a consumer with information about the existence and the quality of investment funds (but one should keep in mind that most banks inform mainly about their own investment funds, this is not the case for independent financialadvisors). But intermediaries can also have some influence on the consumers purchasing behavior. This is also a value for the producer of financial products. At least, a financial intermediary may help the producer of financial products to collect valuable information about his customers by aggregating demand information from a variety of local markets. By providing information about the average conditions on the market, a financial intermediary provides some market transparency. But intermediaries may not only provide information about the product, but also about the usefulness of the product and may help their customers to identify their needs reliably.The insurance business seems to be a good example for this.The distribution of products is a very important economic feature of financial intermediaries because it requires a widespread system of branches which is very capitalintensive.Banks can realize large economies of scale by distributing many financial products via their branches. This means that the distribution of financial services leads to a reduction in average costs (see [6]). This explains why banks supply several services:If a large net of branches once is set up, the banks gain the more economies of scale, the more products are distributed via these branches. These arguments show that only a limited number of banks with a broad regional system of branches can co-exist in a market, as long as the most financial services are distributed via these branches. In other words: The need to keep an expensive system of branches is a high barrier to enter the market for financial intermediation. This may change due to the rise of new communication techniques. This shall be discussed in the next section.4. Functions of financial intermediaries in a net-based world4.1. The need for reputation in financial businessThe most important single feature of the Internet is the reduction of transaction costs. This will lead to enlarged markets and to an extended division of labor. The reduction of communication costs will help financial intermediaries to reach new markets and customers without building up an expensive network of branches. Moreover, with the help of the Internet, from a technical point of view it may be possible that a lender and a borrower meet in electronic platforms so that demand and supply of capital may be matched without the need of a financial intermediary in the traditional sense. This would mean that a computer would be the only tool required to get a loan or to place a saving. Considering the functions of financial intermediaries discussed above, this ideaseems quite unrealistic. Not everybody can become a financial intermediary.The most important reason why financial intermediaries will still be necessary in the age of the Internet is their function as principals and agents. If a intermediary acts as an agent for the lender, a problem of asymmetric information rises. If a creditor gives money to a debtor, he faces two severe problems. First, he has only incomplete information about the ability of the debtor to pay back the loan. As a consequence of this, he will not be able to distinguish between “good” and “bad” loans (adverse selection).Moreover, a bad risk may be willing to pay a higher interest rate, because he might already have decided not to pay the loan back. Adverse selection generates a dilemma for the lender: He has to consider the trade-off between a higher interest rate he might get paid and the risk to loose the loan. If a lender is not able to distinguish between good and bad loans, he treats all borrowers equally, charging a risk-premium from every borrower. This means that the good must suffer with the bad. Banks handle this problem by putting in place a credit function, demanding a collateral or by limiting the volume of credit available to a single borrower (see [4]). This shows a strong argument for the further existence of financial intermediaries in the age of the Internet. A creditor cannot observe the behavior of the debtor after he received the loan. A bad debtor may not attempt to use the borrowed capital in a productive way in order to pay back the loan. After he received the loan, he may change his behavior (moral hazard). This leaves the creditor with the problem to control the behavior of the borrower after he received the loan. For a single lender, the task of finding a trustworthy borrower and to monitor his behavior may be very expensive if not impossible.To avoid this, he gives his money to a financial intermediary who acts as agent for him. The intermediary distinguishes between good and bad risks and supervises the debtor. This makes sense because the intermediary is an expert in identifying good risks and supervising debtors. The division of labor makes sense even in the business THE FUTURE OF FINANCIAL INTERMEDIATION IN THE AGE OF THE INTERNET 13 of financial intermediation. If there are fixed cost of monitoring borrowers, financial intermediaries will obtain economies of scale. This means that there is an advantage for financial intermediaries who specialize in this business. The existence of economies of scale rules out a world in which there are only bilateral relationships between lenders and borrowers.But how can the lender trust the financial intermediary? He may cooperate with theborrower to cheat the lender. This is a classical principal-agent-problem caused by the existence of asymmetric information. One way to overcome this problem is trust(see [11]): If the agent has shown a good performance in the past, the principal (the investor) is willing to trust this agent. A good reputation of a financial intermediary will help him to attract new customers, because new investors are convinced by his good results in the past. These considerations show that an important function of financial intermediaries cannot be replaced by the Internet: The intermediary acts as an agent for the customer; and a customer will not give his money to a financial intermediary without a good reputation. If a intermediary has shown in the past that he is reliable and does not cheat his customers, a customer may consider him as reliable for future business. Moreover, a long term relationship between the lender and the borrower is very helpful because there is already some trust between the lender and the borrower established (see [4]). A customer would never choose a partner as an agent for his money he never heard of before, because he could not be sure whether he would cheat him. The intermediary himself faces the problem of moral hazard and adverse selection when he is investing the money of his customers. This means he acts as agent for the lenders and as principal for the debtors.Choosing an intermediary makes only sense for the creditor if the intermediary has a good reputation. If the intermediary wants to stay in business, he will be aware to pay back the loan in time plus an adequate interest rate. If he will not be able to do this, he will loose his business. His reputation is a signal to potential lenders that he will pay back the money he received. To sum up, a financial intermediary with a reputation as a good debtor reduces the risk for the creditor that a loan may not be paid back. Therefore, the idea of financial business without financial intermediaries is not realistic at all.4.2. The need for large fundsWhat about the second function of intermediaries? As explained above, a financial intermediary helps to transform assets in their maturity, size and risk. At a first glimpse, the Internet will make it easier to transform assets because of the reduced costs of communication between potential borrowers and lenders. It will be easier to find an adequate partner or partners via the Internet looking for a loan that has the size and maturity the lender is willing to supply. Insofar, the matching of assets in maturity and size may become easier in the age of the Internet. One important function of intermediaries explained in the section above, the supply of an centralized market to ease the matching of supply and demand on capital, seems to be endangered. The needto transform as14 sets may be reduced due to the fact that it will become much easier to find an adequate partner.This is not true for the transformation of the risk of assets. By pooling large funds, financial intermediaries reduce the risk of an investment to the investor. If a lender gives a loan to a single person and the borrower fails to pay back the loan, the lender will loose all his money. If a lender fails to pay back a loan to a financial intermediary,this intermediary will not become insolvent, because this loan represents only a small fraction of his funds. From this point of view it makes sense to an investor to invest his money not in a single project or give it to a single borrower. If he puts his money in a fund, he trades the risk of a single project against the share of a risk of a portfolio of investments. These considerations show that it requires much more than a computer to provide financial services – even in the age of the Internet. A financial intermediary needs a large fund of savings, loans and investments to reduce the risk for the single customer. By giving their customers products with stable distributions of cash-flows, financial intermediaries can reduce the costs of an investment for their customers (see[1]). This shows that not everybody will be able to become a financial intermediary. The function of financial intermediaries as risk-pooling institutions will be very important in market segments with illiquid assets or long-term maturities. In these segments, the risk and the standard deviation of the returns on investment are very high. It requires a high risk premium and a large pool of funds to compensate for this risk.As shown above, to do this a financial intermediary needs a large pool of funds. This pool of funds is also needed to guarantee his customers a certain amount of liquidity. The necessity of keeping a certain amount of assets is surely a barrier for new entrants to enter the market for financial services. With these considerations in mind, one can assume that with a greater risk of a financial transaction – that requires a larger pool of funds to reduce this risk – or lesser standardization of an asset (which means a more illiquid market for this asset) the entry of new competitors may become less likely because not every intermediary may be able to keep a large fund of assets in order to transform the risk of its consumers assets and to guarantee them liquidity. One important function of financial intermediaries, the transformation of risks, will not be endangered by the rise of the Internet. This seems to be a very important argument, because the importance of risk management undertaken by financial intermediaries has grown rapidly in recent years (see [1]).。