Final answer:
Depository institutions include banks and thrifts; both accept deposits and provide loans. Thrifts specialized in housing loans and had interest rate restrictions historically. Finance companies are excluded as they don't accept deposits.
Step-by-step explanation:
Depository institutions predominantly include banks and thrifts, which are often referred to as savings and loans. These institutions are integral to the financial system as they accept money from depositors and provide loans to individuals and businesses. Commercial banks were originally created to support business transactions securely, offering the ability to issue checks and manage business expenses. Subsequently, thrift accounts emerged, designed primarily for individual depositors to utilize demand deposit accounts and write checks, akin to modern checking accounts.
Both banks and thrifts are organizations that accept loans and take deposits. However, thrifts have historically been subject to restrictions on the interest rates they could offer, and they were mandated to focus their lending on housing-related loans. Thus, when considering the components of depository institutions, we find that finance companies are not included, as they do not take deposits but rather focus on providing credit facilities.