Master of Economics and Business Bissenova R.A.

Kyzylorda State University Korkyt Ata, Kazakhstan

The Money Market of Kazakhstan and its instruments

The money market is a market of cash and of cashless means of payment. The population, companies and public institutions can borrow short-term funds they need, or to invest temporary free financial resources to get income. Economic units with temporary excess funds could direct them to money markets and thus obtain interest income. At the same time economic units wishing to make borrowing for a short period, could borrow or issue its own securities.

In the financial activity of economic entities for their current liquidity are important financial instruments of the money market, which provides a mechanism for allocation and reallocation of funds between buyers and sellers of goods and services. It is known that the foundation of any financial instrument anyhow serve money.

Proceeding from functions of money it is possible to determine the main functions of the money market:

· payment function - the market contributes to the implementation of various types of settlements between the participants in the process of operations;

· providing commercial lending - a delay of payment, decorated monetary obligation that is a bill of exchange, allows commercial lending businesses;

· accounting, function, and others.

In the process of circulation of money between financial market participants, there are certain attitudes about the redistribution of funds that make up the so-called system of monetary relations:

· between businesses and workers in their population;

· between units within the industry and businesses;

· between providers and payers;

· between entities and the state;

· between state, regional and local budgets and off-budget funds;

· between business entities and credit system;

· between business entities and stock exchanges, insurance companies, property funds and other instruments or functioning of financial and credit system;

· between the population and the state, as well as public organizations and instruments of the financial infrastructure.

All these processes reflect the overflow of financial resources to the funds, including capital formation, their distribution, use and evaluation of the effectiveness economic and social development. Commercial banks constitute the most important group of participants in the money market, they buy and sell virtually all of them are circulated on financial liabilities. Banks are continuously engaged in correction their liquid funds short-term by reason its own borrowing requirements to a broad range parameters provided loans.

The State Treasury has big problems with liquidity. The fact is that the Treasury receives the tax payments only on set dates and public expenditures requires payment during the year. In addition, government expenditures often exceed his income. Thus, the Treasury has the responsibility to finance the public debt. This problem is solved with the help of issuing short-term and long-term securities. Companies are also often faced with the problem of liquidity, although not in an acute form, as commercial banks. For many firms, the main stream of cash flow amounts to the payment of receivables formed after the implementation of these products. At the same time, their costs consist of tax payments, payment of salaries, purchase of materials and services needed for the current activity.

The following financial instruments of the money market are used to handle the following transactions in the territory of RK:

· transfer of cash (banknotes);

· issuance of checks;

· issuance of bills or transmission by endorsement;

· the use of payment cards;

· treatment IOUs

Payments with cash are made by transferring them in the form of banknotes and coins are legal tender. The given kind payment is the physical transfer of bank notes or coins of the person performing it (payer), the person to whom the payer has an obligation. Cash payment can be done by a person to whom the executed financial obligations, either directly or through an intermediary.

Payments made by check via the settlement, road and other checks - written instructions of the payer to his bank to pay his check account holder a certain amount. In world practice, it is divided into monetary and settlement check. Bill - is an absolutely obligation to pay to any person a sum of money in a certain place at a certain time. This abstract debt, which does not depend on any conditions. According to the Law of the RK "On circulation of bills in the Republic of Kazakhstan", the payment instrument and a means of lending the bill does not concern to securities in our country. Bills are divided into two main types: simple and transferable.

A promissory note (solo) - a bill that contains any obligation of the debtor (drawer) to pay to the creditor (bill holder) a certain amount of money in a certain place and in a timely manner, or by order of a creditor to transfer funds to a third party.

The distinguishing feature of a promissory note is that the debtor is always the person was discharged bill of exchange - the drawer of a bill. The holder of an instrument may be used in the calculations with their counterparties, transferring their debt to the drawer of a bill.

Transfer bill of exchange (draft) - a document regulating bill relations of three parties: the creditor (drawer), the debtor (the drawee) and the beneficiary (payee). Peculiarities of notes and circulation of the bill is it cannot serve as a simple means of payment. The essence of this relationship is as follows: the drawer (drawer) writes out (traces) to of the drawee a bill with a proposal to pay a certain sum of money to the payee in a certain place at a certain time.

Billing Preferences card is a means of access to the money through electronic terminals or other devices that contain information that allows the holder of the card to make payments, withdraw cash, currency exchange and other operations defined by the issuer and its conditions.

Payment card is divided into debit and credit (Rules of issuance and use of payment cards in the Republic of Kazakhstan, approved by the National Bank of 24.08.2000 №331). The National Bank is the only body, the licensing activities related to the issuance of payment cards, and establish requirements for the issuance and use of them in the Republic of Kazakhstan.

Providing loans to each other without banks, the population makes out IOUs (debentures), certified true notaries, which can also be regarded as a financial instrument of the money market. It should be noted the appearance of such financial instruments as agricultural receipts sold under the pledge of future agricultural production. Today, these debentures received the greatest distribution in Kazakhstan compared with the drafts.

Literature

1. Искаков У.М. Рузиева Э. Бохаев Д.Т. Финансовые рынки и посредники. Алматы-Экономика ,2005.

2. Международные валютно-кредитные и финансовые отношения: Учебник / Под ред. Л.Н.Красавиной.-Москва

1.«ОНациональном банке РК» Закон РК от 30.03.1995 г.

2. «О банках и банковской деятельности в РК» Закон РК от 31.08.1995 г.