The Measurement of Banking Services in the System of National Accounts

The paper considers some of the problems associated with the indirectly measured components of financial service outputs in the System of National Accounts (SNA), termed FISIM (Financial Intermediation Services Indirectly Measured). The paper characterizes FISIM by a user cost and supplier benefit approach determining the price and quantity of various financial services in the banking sector. We examine the need for FISIM in the context of plausible alternative accounting schemes that could be used to account for financial services. The alternative accounting frameworks have implications for the labour and multifactor productivity of both the financial and nonfinancial sectors.