Money Market:

The money market is a market for short-term loans. It consists of financial institutions having surplus funds to lend on short-term basis, and those wishing to borrow. The market allocates savings into investment thereby promoting rational allocation of resources. It also encourages savings and investment habits by promoting liquidity and safety of financial assets.

Institutions that operate in the market include the Central Bank, commercial banks, and discount houses. The major short-term instruments associated with the Nigerian money market include treasury securities, commercial papers, call money, Bankers Unit Fund, Bankers' Acceptances, etc.