What are the similarities between Money and Near Money?

There are some similarities between money and near-money.

(i) Both money and near-money are claims. Coins and currency are a claim over the government and the central bank. Bank money is a claim over the bank in which the deposits are held.

Near-money assets are claims over their respective parties or institutions. For example, a government bond is a claim over the government which has issued it; a bill of exchange is a claim on the party which has agreed to pay the amount mentioned in the bill.

(ii) Money is not qualitatively different from near-money. Liquidity is the common attribute of both money and near-money. They differ only in terms of degree of liquidity.

(iii) Both money and near-money act as a store of value. But, near-money assets are preferred because they yield income along with being a store of value.