2. 
A money market is a market for
borrowing and lending of short-term
funds. It deals in funds and financial
instruments having a maturity period of
one day to one year. It is a mechanism
through which short-term funds are
loaned or borrowed and through which
a large part of financial transactions of a
particular country or of the world are
cleared.

3. 
In money market transactions of large
amount and high volume take place. It is
dominated by small number of large
players. In money market the players are
:-Government, RBI, DFHI (Discount and
finance House of India) Banks, Mutual
Funds, Corporate Investors, Provident
Funds, PSUs (Public Sector Undertakings),
NBFCs (Non-Banking Finance
Companies) etc.

4. The Money market in India is the money
market for short-term and long-term funds
with maturity ranging from overnight to one
year in India including financial instruments
that are deemed to be close substitutes of
money.
 Similar to developed economies the Indian
money market is diversified and has evolved
through many stages, from the
conventional platform of treasury bills and
call money to commercial paper,
certificates of deposit, repos, forward rate
agreements and most recently interest rate
swaps


5. 
The Indian money market consists of diverse
sub-markets, each dealing in a particular
type of short-term credit. The money market
fulfills the borrowing and investment
requirements of providers and users of shortterm funds, and balances the demand for
and supply of short-term funds by providing
an equilibrium mechanism. It also serves as
a focal point for the central bank's
intervention in the market.

6. Organised Sector
 Call and Notice
Money Market
 Treasury Bill Market
 Commercial Bills
 Certificate of
Deposits
 Commercial
Papers
Money Market
 Mutual Funds
 The REPO Market
 DFHI
Unorganised Sector
 Indigenous Bankers
 Money Lenders
 NBFI


7. In the sixties, the Philippine economy exhibited considerable
growth where production expanded at a steady pace and the
investment climate was regarded as generally favorable.
Based on these sound economic considerations came the birth of
the money market in the Philippines. More investment
alternatives were offered to the public with the introduction of
various money market instruments.

8. The Joint IMF-CBP Commission convened
in 1971 whose recommendations were
accepted by the President.
 Of the various suggestions one was: “The
supervisory reach of the Central Bank
would reach to the Money Markets also.”


9. The Money Market grew largely because of
the Investment Houses in the 1960s, before
which it was largely under-developed.
 Prior to this it was unregulated and the
interest rates were determined by the Usury
Laws.
 The large investors could avoid the interest
and this led to the concentration of these
instruments in the hands of the large
investors


10. An investment house driven money
market grew by 34% in between 1966 –
1973
 After the Central Bank started regulating
the system, balance was restored into
the system and the MM instruments were
deemed deemed deposit substitutes.
 Thus only after years of its disorganised
functioning did the Money Market in the
Phillipines get regulated.


11. 
Although it is the world's 12th most
populous country, the Philippines savings
rate of 19% to 23% of GDP is the lowest in
the region. Around three quarters of the
country’s population do not yet have a
savings account. The Philippine fund
industry is also the second smallest in the
region.

12. 
The Philippines is open to foreign portfolio
capital investment. Foreigners may
purchase publicly or privately issued
domestic securities, invest in money
market instruments, and open pesodenominated savings and time deposits

13. Inter Bank Call Loan: The Inter Bank Call Loan market is a
system that permits banks with excess reserves over the required
position for the day to lend out the same excess to reserve
deficient banks.
Issuer: BSP
Term: One day although at times the term exceeds more than one
day
Other Requirements: Borrowing IBCL transactions with the BSP
require the borrowing party to earmark securities as collateral in
the ROSS account with the Bureau of Treasury. Alternately,
lending with the BSP requires the BSP to earmark securities with
an equivalent face value of the amount borrowed. IBCL
transactions between banks and quasi-banks are on a clean basis.

14. Reverse Repurchase Agreement: A Reverse Repurchase Agreement
(RRP) is defined where the BSP sells securities to a bank or financial
institution that has quasi-banking licenses, with a commitment to buy
this back on a specified date and specified rate. The RRP serves as a
monetary tool of the BSP to control money supply using open market
operations.
Issuer: BSP
Term: Subject to the discretion of the BSP oftentimes overnight, 14,
and 30 days
Other Requirements: Through the BSP RRP as its definition connotes
in substance a borrowing transaction collateralized by a security. The
securities that serve as collateral are usually in the form of Treasury
Bills Special Series or Fixed Rate treasury notes. RRP transactions
would require the BSP to earmark securities with an equivalent face
value to the amount borrowed, regardless of the tenor of the instrument
collateralized

15. Treasury Bills: Treasury Bills (Tbills) are direct and unconditional
obligations of the national government. They are issued by the
Bureau of Treasury (BTr). They carry a maturity of one year or
less and can be traded in the secondary market before
maturity.Treasury Bills are considered one of the primest
investment instruments in the market. They are safe, liquid and
offer attractive returns to investors.
Issuer: National government
Term : 91, 182, 364 days

16. Fixed Rate Treasury Notes: Fixed Rate Treasury Notes (FXTNs) are
direct and unconditional obligations of the national government. They
are issued by the Bureau of Treasury (BTr). They are interest bearing and
carry a term of more than one year and can be traded in the secondary
market before maturity.Fixed Rate Treasury Notes are considered one of
the primest investment instruments in the market. They are safe, liquid
and offer attractive returns to investors.
Issuer: National government
Term: 2, 5, 7, 10, 15, 25 years

17. Fixed Rate Treasury Notes: Retail Treasury Bonds (RTBs) are
direct and unconditional obligations of the national government
which primarily caters to the retail market or the end-users. They
are issued by the Bureau of Treasury (BTr). They are interest
bearing and carry a term of more than one year and can be traded
in the secondary market before maturity. Retail Treasury Bonds
are safe, liquid and offer attractive returns to investors.
Issuer: National government
Term: 3 and 5 years

18. Dollar Linked Peso Notes: Dollar Linked Peso Notes (DLPNs)
are direct and unconditional obligations of the national government
and are issued by the Bureau of Treasury (BTr). They are interest
bearing and carry a term of more than one year and can be traded
in the secondary market before maturity. The notes track the
movement of the Philippine Peso and US Dollar exchange rate.
Payments of interest and principal are linked to the movement of
the exchange rate and computed based on the foreign exchange
factor.
Issuer: National government
Term: 2 and 3 years

19. The money market continued to be generally liquid in 2008 despite the
global financial turbulence that had escalated during the year.
The volume of money market transactions (inclusive of placements
with the BSP, interbank call loans, interbank swap transactions and
Treasury bills) aggregated PHP 84,259 billion in 2008, 23% higher
than the previous year’s level and the highest volume recorded in the
last nine years. Growth was driven primarily by increased short-term
placements with the BSP which rose markedly by more than 20% to
PHP 76,217 billion.
This notable rise in short-term placements with the BSP reflected
banks’ preference to remain liquid amid generalised risk aversion and
cautiousness given the challenging economic conditions. It could also
be explained by the reduced demand for loans because of lower growth
prospects.