The financial intermediation reflects the conduction of different transmissions and transferring within the funds and the financial assets from the different parties within the market. The development of the baking systems and the financial intermediaries are considered to be the bases for the enhancement of the coordination within the financial transactions, payments, and transferring of the ownership of the financial assets form one person or customer, who is considered to be the lender, to another, who is considered to be the borrower (Ansari, 1998). The role of the financial intermediaries is considered to be the elimination of the risks and the problems that may be faced by the parties within their different stages of their interactions. The most effective intermediaries and coordinators are considered to be the commercial banks (Brigham & Besley, 2008). The orientation of the people toward the depending on the banks over the commercial banks had been based on the great advantages that are being provided by the banks, regardless its types. On the other hand, the banks are considered to be holding a very high rate of profitability that are being allocated throughout the different interest rates and commissions that are being conducted by the banks for their services and financial products (Boot & Thakor, 2008). The following paper will be representing the main advantages and disadvantages that are considered to be embedded within the short term policies of the interest rates that are being applied and enforced by the Egyptian Central Bank. After the conduction of a huge identification for the various features and characteristics of the banking systems and the financial policies on internal bases, the author will be conducting identification for the effectiveness of the financial policies that are being imposed by the Egyptian government.