Banking system: essence, functions and principles of development

doi:10.26565/2786-4995-2025-2-04

Oleksandr Baranovskyi SESE «The Academy of Financial Management» https://orcid.org/0000-0002-5505-5098
Oleksandr Borschuk SESE «The Academy of Financial Management» https://orcid.org/0000-0002-3960-6240

DOI: https://doi.org/10.26565/2786-4995-2025-2-04

Keywords: banking system, properties of the banking system, types of banking systems, functions of the banking system, principles of banking system formation

Abstract

The importance of a well-founded definition of the essence of the banking system, its functions, key characteristics, and fundamental principles of formation stems from its role in ensuring the country’s viability in favorable conditions, during crises or wartime, in the post-war recovery period, and in the course of steady socio-economic development. The state and specific features of the functioning of the banking system (BS) largely determine its potential to influence the post-crisis and post-war recovery of the national economy and to support crediting for expanded reproduction.
The aim of the article is to deepen the theoretical and methodological foundations for identifying the features of the functioning and development of the banking system. The object of the research is the banking services market. The dialectical, monographic, and historical methods were used, along with methods of systemic, expert, and logical analysis, and grouping.
The article defines various approaches to the interpretation and analysis of researchers’ views on the essence of the banking system, its distinctive properties and functional purpose, the classification of its types, and the principles of its formation. The author’s own perspective on these aspects of the functioning and development of the banking system is also presented.

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Author Biographies

Oleksandr Baranovskyi , SESE «The Academy of Financial Management»

Dr. Sc. (Economics), Professor

Oleksandr Borschuk , SESE «The Academy of Financial Management»

PhD student

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