Functions of Money

• Functions of Money are:


  • Medium of exchange - Money is any asset widely acceptable as a medium of exchange, if it facilitations between buyer and server.
  • Store of value - An asset that holds value over time.
  • Unit of account - Nominal unit of measure/cost products, assets debts, income & spending.
  • Standard of deferred payment - the accepted way, in each market, to settle a debt.
• Key characteristics of money

  • Hard to counterfeit
  • Durable & portable
  • Acceptable when making transactions
  • Holds value over time
• Digital Money


  • Digital Wallets - Mobile payment apps & digital wallets allow users to store digital money balances & make online payments.
  • Cryptocurrencies - E.g. Bitcoin & Ethereum
  • Central Bank Digital Currencies (CBCDs) - Some central banks are exploring the idea of issuing digital versions of their national currencies.
  • Prepaid Cards - Prepaid debt/ gift cards issued by financial institutions are a form of digital money.