MONEY vs CURRENCY

Money and Currency are often used synonymously, but they are different.

▫️MONEY
Money is any object or item generally accepted as a mode for payment of goods and services and repayment of loans or debts (taxes, etc.), in a particular nation or country. It acts as a store of value, allowing individuals to save wealth and transfer purchasing power over time.

🔺CHARACTERISTICS of MONEY

• MEDIUM OF EXCHANGE
Money serves as a commonly accepted medium for buying and selling goods and services. It eliminates the need for barter, by providing a widely accepted means of payment.

• UNIT OF ACCOUNT
Money provides a standard measure of value that allows individuals to compare the worth of different goods and services. Prices are expressed in monetary terms, making it easier to assess relative values and make informed decisions about purchases and investments.

• STORE OF VALUE
Money enables individuals to store wealth in a convenient and portable form.

▫️CURRENCY
Currency is a specific form of money that is issued and regulated by a government or central authority. It serves as a medium of exchange for goods and services.

🔻CHARACTERISTICS of CURRENCY

• ISSUED BY AUTHORITY
Currency is typically issued by a government or central bank, which has the authority to regulate its supply and circulation within the economy.

• LEGAL TENDER
Currency is designated as legal tender (meaning it is recognized by law as a valid form of payment for debts and transactions).

• PHYSICAL AND DIGITAL FORMS
Currency can exist in both physical and digital forms. Physical currency includes coins and banknotes, while digital currency may be represented electronically.

▫️HEAD TO HEAD

• Money is a store of value over time.
• Currency loses value over time.

• Money refers to a medium of exchange that is widely accepted in transactions for goods, services, and debts. It serves as a unit of account, a store of value, and a medium of exchange.
• Currency refers to the physical or tangible form of money issued by a government or central authority.

• Money can be issued by various entities, including governments, central banks, commercial banks, and non-governmental organizations.
• Currency is specifically issued by the government or central authority. It is legal tender, meaning it must be accepted for transactions within the issuing country.

• Money encompasses a broader concept that includes various forms of value exchange (physical currency, digital currency, checks, etc.).
• Currency is a subset of money, representing the physical or tangible form of money used in day-to-day transactions within a specific geographical area.